Dow Sells 40% Stake in U.S. Gulf Coast to Macquarie for $2.4 Billion

In a strategic move to focus on its core chemical business, Dow has agreed to sell a 40% stake in certain infrastructure assets on the U.S. Gulf Coast to Macquarie Asset Management. The deal, announced on Monday, is valued at $2.4 billion. Dow also stated that if Macquarie opts to increase its stake to 49% within the first six months following the completion of the agreement, total cash proceeds could rise to approximately $3 billion.

Following the announcement, Dow's shares rose nearly 5% in pre-market trading, reaching $44.14.

The assets in question are part of Dow's effort to reassess its non-product operations, and include facilities for energy and steam generation as well as pipeline networks. This reassessment aligns with the company's efforts to optimize its global asset portfolio.

Dow has also initiated similar reviews elsewhere; for instance, an examination of its European assets began in October. These assets represent about one-fifth of Dow’s sales in the Europe, Middle East, Africa, and India (EMEAI) region.

The newly formed entity, Diamond Infrastructure Solutions, will serve as an infrastructure provider to Dow and other industrial companies at five sites in Texas and Louisiana.

The transaction is expected to be completed in the first half of 2025.

This development comes after Dow's removal from the Dow Jones Industrial Average last month. This change was driven by challenges faced by the company, including a slow recovery in demand and a tight regulatory environment. Dow was replaced by Sherwin-Williams in the leading stock index.

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