People in Midland are waiting to see what effect the announced merger of Dow Chemical and DuPont will have on their city.
Midland is a company town. Everywhere you look you see the Dow diamond logo, from the city’s minor league ballpark to cultural institutions.
And of course, there’s the sprawling Dow Chemical complex on the city’s south side.
Dow started in Midland over a century ago. But that long history is about to head in a new, uncertain direction.
Dow Chemical CEO Andrew Liveris announced the proposed mergerwith rival DuPont and full acquisition of Dow Corning during a morning webcast. Liveris calls the proposed deal a "tectonic shift" in the chemical industry.
“This transaction is a truly once in a lifetime opportunity,” Liveris told reporters.
Dow Chemical represents more than half of the Midland region’s economy.
Midland Mayor Maureen Donker has been nervously waiting for the deal to be announced, since word of the merger was first leaked earlier this week.
She was briefed by Dow officials shortly after the formal announcement.
“Up until today everything was speculation,” says Donker. “Today we have information and I think that’s important because that begins to really give us a path on which to go down.”
Still, Donker says it’s too soon to predict what the merger will mean for her city.
“My guess is in Midland we’re going to see a growing economy,” says Tim Nash, the Fry Endowed Chair in Free Market Economics at Northwood University in Midland. He sees the deal as a long-term positive. He notes that DuPont will eventually own many of Dow Chemical’s plants in Midland.
And he expects DuPont will keep those plants operating.
“We could actually see more employment in the area because those people will simply stay here manufacturing some of the best ag products in the world,” says Nash, noting that DuPont will take the lead in agricultural products once the deal is done.
Thousands of people work at Dow Chemical in Midland.
Kent Holsing is the president of the United Steelworkers local. He’s concerned the proposed merger, along with its plan to eventually break up the new Dow-DuPont into three separate companies, will mean layoffs.
He’s also worried about the role activist investors have played in pushing this merger forward. Activist investors often put improving a company’s stock price ahead of workers needs and community investment.
“It boggles my mind,” says Holsing, “how much a small group of people control the fate and future of so many.”
And Holsing is concerned what a changing Dow Chemical might mean for Midland.
“The Dow Chemical of old that this community has come to know and love over the last 100 plus years … I think that is going to be totally changed,” says Holsing.
The merger is far from a done deal.
In addition to getting approval from investors, the deal must also get approval from government regulators in the U.S. and other countries.
