New York – Shares of Dow Chemical Co. rose almost 5 percent Monday after a British newspaper reported a group of Middle Eastern investors and U.S. buyout firms was preparing a bid for the huge chemicals and plastics maker.
But Dow said Monday it’s not in discussions about a leveraged buyout.
The Sunday Express, a British tabloid, reported over the weekend that the group has secured financing backing for a $50 billion bid for the Midland, Mich.-based chemicals company. It would be the biggest leveraged buyout ever.
The Express reported the investment team, which includes private-equity firm Kohlberg Kravis Roberts & Co., is preparing a bid of $52 to $58 per share. At the low end, that would be a 17 percent premium over Dow Chemical’s closing stock price of $44.47 on Thursday on the New York Stock Exchange. The market was closed Friday.
Dow Chemical’s stock jumped $2.16, or 4.9 percent, to $46.63 in regular trading Monday on the New York Stock Exchange after rising to a 52-week high of $47.60 earlier in the session.
The newspaper said a bid of between $52 to $58 a share could come this week, with half the financial backing coming from investors in Saudi Arabia, Kuwait, Bahrain, Qatar, the United Arab Emirates and Oman, and half from U.S. investors.
The newspaper didn’t name any investors other than KKR and did not cite sources.
A KKR spokeswoman declined to comment Monday.
