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Special Report: Forum on Dow Chemicals Commodity Chemical Carve-Out
Report Overview
In the summer of 2013, Dow Chemical indicated that
it was considering a number of options for various
commodity chemical businesses. On December 2, 2013,
Dow announced that it was carving-out a significant
portion of its chlorine value chain. The targeted assets
support revenues of about US$5 billion including
merchant as well as captive (internal) sales. The assets
include about 40 manufacturing facilities at 11 sites and
nearly 2,000 employees. Dow noted that all types of
transactions would be considered for the Carved-Out
businesses, ranging from outright sale, to joint venture to
IPO.

The questions that the study will address, by business will,

among others, include:

What assets are identified and how are these assets

integrated with the greater complex where they are
located?

What is the market outlook for the key products in the

Carve-Out? Approximately where are products sold, who
are the major offtakers, and what other channels to market
are used?

Describe the health and overall growth rate in the

regional and global market for the main products. What
environmental or regulatory issues might further impact
growth?

Recognizing that the three businesses in the Carve-Out

are almost entirely commodities, the cost position of the
businesses will be critical to understand as it dictates their
attractiveness and long-term sustainability. In addition,
it should be recognized that most of the assets to be
carved-out are located in the USGC and have and should
continue to benefit from abundant and low cost shale gas
presumably further enhancing their competitive position.
Understanding the future potential magnitude of this
advantage would also be of keen interest to prospective
investors.

What is the cost position of the assets and how does that
compare to the leading competitors?

How do these businesses compare on a delivered cost

basis in key consuming markets?

Nexant believes that it is well positioned to help

prospective buyers and investors in these assets better
understand the market and competitive (i.e., cost)
position of these businesses, by leveraging our decades
long expertise in cost analysis for the chemical industry
as well as experience with the identified businesses.
Therefore, Nexant is proposing a multi-subscriber study
Forum which will analyze the market, technology and
cost position of the identified assets. The results of the
study will be presented in a Workshop or Forum setting,
whereby subscribers assemble to hear presentations on
the project teams findings and also have a chance to
pose questions to the study team.

Nexant expects to initiate this study by early to mid Q2 2014

and finish the study about 3 months following initiation. The
study will be offered in three parts:

U.S. Gulf Coast Chlor-Alkali and Chlor-Vinyl

Global Epoxy

Global Chlorinated Organics

Each part can be subscribed to independently, or subscribers

can purchase all three sections. In addition to attending the
Forum, subscribers will also gain access to the presentation
materials and soft copies (Excel) of the final costs analyses.
Download the prospectus for more details.
For information regarding the upcoming Forum on Dow
Chemicals Commodity Chemical Carve-Out report, please
contact STMC@nexant.com.

NexantThinking Programs provide subscribers and users with comprehensive analytics,

forecasts and insights for the energy, chemicals, polymers and clean tech industries
For more information, please visit us at: http://thinking.nexant.com

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