Probably no major company has made JVs as integral a part of its strategy as Dow Chemical Co., as Corporate Dealmaker showed in a 2006 cover story. The soaring cost of hydrocarbon feedstocks has led Dow to deals like the one that created MEGlobal, a 50-50 JV with Petrochemical Industries Co. of Kuwait that in 2004 became the vehicle for Dow's assets in the higher-growth ethylene glycol business.

So it's not so surprising that when Dow CEO Andrew Liveris was asked about a possible major deal for the company in an analyst call this week, he brushed aside speculation about a merger and spoke in terms of a JV, pointing to MEGlobal as the kind of growth platform Dow desires.

Dow clearly wants the world to know how its JVs work, even releasing a white paper on the topic in September. "Joint ventures have become a significant part of our company in terms of both earnings and cash flow, so we wanted to provide the investment community with more information about them," Kathy Fothergill, Dow's director of investor relations, told us via e-mail. "The feedback from investors and financial analysts has been positive. They appreciate the transparency, and we like that they have a fuller view of the company."

Speaking via webcast on Oct. 25, executive vice president and CFO Geoffery Merszei said, "Geographically, we saw double-digit sales growth in Europe, Asia Pacific and Latin America. With such strong growth, the regions outside the U.S.A. now account for more than 65% of Dow's global revenues. Including our share of sales from joint ventures, that number is now more than 70%."

Dow also continues to invest in targeted acquisitions, bringing their year-to-date total close to $900 million. Dow was recently reported as the most likely buyer for Chemtura Corp., which was formed when Crompton Corp. acquired Great Lakes Chemical Corp. for $1.8 billion.
— Baz Hiralal and Kenneth Klee

Go to the story from MarketWatch on the analyst call
See Dow's White Paper on Joint Ventures
Have a look at Dow's principal JV partners

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