DOW Dow Inc

By Alison Sider and Lisa Beilfuss 

Longtime Dow Chemical Chief Executive Andrew Liveris said he would leave by mid-2017, after the company completes its planned merger with rival DuPont Co.

Midland, Mich.-based Dow, a giant in the chemical and agriculture industries and maker of products ranging from corn seeds to plastic, in December struck a deal to combine with DuPont into a $120 billion company that would have about $90 billion in sales.

The merged company, if the deal is approved, expects to cut some $3 billion in costs before splitting into three separate businesses 18 to 24 months after the merger closes.

Mr. Liveris, who has served as Dow's chief executive for more than a decade, said Tuesday that he won't stay on to lead one of the new businesses. Late last year, Mr. Liveris hinted that the deal was a culmination of his tenure at the company and that he was nearing retirement.

In response to activist-investor Dan Loeb and his hedge fund Third Point LLC, which had called for Mr. Liveris to step down, Dow said Mr. Liveris "does not contemplate serving" as CEO of the new material-sciences business that will emerge from the breakup.

Third Point won't be launching a proxy fight for board changes at Dow this year, which Mr. Loeb privately had threatened in the past year, said people familiar with the matter.

"We thank Mr. Liveris for his role in effectuating the Dow/DuPont merger and wish him success in his next chapter," Mr. Loeb said in a statement. "We look forward to engaging constructively with the new management teams" at combined Dow/DuPont's post-breakup companies.

Dow on Tuesday announced the elevation of Vice Chairman and Chief Operating Officer James Fitterling, who as president and COO will help shepherd the merger and assist with the transition. Dow said the companies hope to complete their combination by the end of this year.

Dow said on Tuesday that profit rose in its latest quarter as a result of a gain stemming from the sale of a chunk of its chlorine business.

Revenue, meanwhile, slid 20% due mostly to price declines and adverse foreign-exchange rates. Results topped expectations and sent shares up 3.3% in premarket trading.

The company said consumer demand remains strong even amid worries that global economies are precarious. Sales volume rose 4% last year, excluding the impact of acquisitions and divestitures.

"The global economy continues to be volatile with consistent demand being driven by the consumer, especially in the U.S. and increasingly from China," Mr. Liveris said. "We believe low energy prices are a net benefit and will help overcome negative investment sentiment in other sectors."

In Dow's plastics segment, its largest, cheap raw materials helped push that business's operating profit to a fourth quarter record of $1.3 billion.

In the fourth quarter, Dow separately completed its roughly $5 billion divestiture of Dow Chlorine Products.

The sales decline was offset by a large gain on the sale of the chlorine business in addition to reduced overhead costs and lower research and development spending.

For the quarter, Dow reported a profit of $3.61 billion, or $2.94 a share, up from $819 million, or 63 cents, a year earlier. Per-share results reflect the payout of preferred dividends.

Excluding a gain of $1.96 a share resulting from the aforementioned divestiture, among other items, per-share earnings rose to 93 from 85 cents.

Revenue declined 20% to $11.46 billion. Analysts projected 70 cents in adjusted earnings per share on $11.2 billion in revenue, according to Thomson Reuters.

David Benoit contributed to this article.

Write to Alison Sider at alison.sider@wsj.com and Lisa Beilfuss at lisa.beilfuss@wsj.com

(END) Dow Jones Newswires

February 02, 2016 14:10 ET (19:10 GMT)

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