Dow Chemical 2011 Annual Report Download - page 190

96
The Company has service agreements with some of these entities, including contracts to manage the operations of
manufacturing sites and the construction of new facilities; licensing and technology agreements; and marketing, sales, purchase
and lease agreements.
Excess ethylene glycol produced in Dow’s plants in the United States and Europe is sold to MEGlobal and represented 1
percent of total net sales in 2011 (1 percent of total net sales in 2010 and 1 percent of total net sales in 2009). In addition, the
Company sells ethylene to MEGlobal as a raw material for its ethylene glycol plants in Canada. Sales of ethylene and ethylene
glycol to MEGlobal are reflected in the Feedstocks and Energy segment and represented 5 percent of the segment's sales in
2011 (6 percent in 2010 and 7 percent in 2009).
NOTE I – GOODWILL AND OTHER INTANGIBLE ASSETS
The following table shows changes in the carrying amount of goodwill for the years ended December 31, 2011 and 2010, by
operating segment:
Goodwill
In millions
Gross goodwill at Jan 1, 2010
Accumulated impairments at
Jan 1, 2010
Net goodwill at Jan 1, 2010
Divestitures:
Styron
Powder Coatings
Hydrocarbon Resins
Foreign currency impact
Net goodwill at Dec 31, 2010
Acquisition of seed company
Sale of a Dow Automotive
Systems product line
Foreign currency impact
Net goodwill at Dec 31, 2011
Accumulated impairments at
Dec 31, 2011
Gross goodwill at Dec 31, 2011
Electronic
and
Functional
Materials
$ 4,967
—
$ 4,967
—
—
(9)
(9)
$ 4,949
—
—
(15)
$ 4,934
—
$ 4,934
Coatings and
Infrastructure
Solutions
$ 4,118
—
$ 4,118
—
(4)
—
(57)
$ 4,057
—
—
(16)
$ 4,041
—
$ 4,041
Ag
Sciences
$ 1,546
—
$ 1,546
—
—
—
—
$ 1,546
12
—
—
$ 1,558
—
$ 1,558
Perf
Materials
$ 1,306
(220)
$ 1,086
(111)
—
—
(9)
$ 966
—
(7)
—
$ 959
209
$ 1,168
Perf
Plastics
$ 1,463
(30)
$ 1,433
(30)
—
—
(17)
$ 1,386
—
—
(11)
$ 1,375
—
$ 1,375
Feedstocks
and Energy
$ 63
—
$ 63
—
—
—
—
$ 63
—
—
—
$ 63
—
$ 63
Total
$13,463
(250)
$13,213
(141)
(4)
(9)
(92)
$12,967
12
(7)
(42)
$12,930
209
$13,139
The recording of the April 1, 2009 acquisition of Rohm and Haas resulted in goodwill of $9,707 million (see Note D) ,
which is not deductible for tax purposes. During the first quarter of 2010, goodwill related to the acquisition of Rohm and Haas
increased $99 million for net adjustments made during the measurement period to the fair values of the assets acquired and
liabilities assumed. In the table above, these adjustments have been retrospectively reflected in the goodwill at January 1, 2010,
in accordance with the accounting guidance for business combinations. The adjustments increased goodwill for the operating
segments as follows: Electronic and Functional Materials ($33 million), Coatings and Infrastructure Solutions ($47 million),
Agricultural Sciences ($2 million), Performance Materials ($4 million) and Performance Plastics ($13 million).
As a result of the June 17, 2010 divestiture of Styron, $141 million of associated goodwill and $16 million of intangible
assets were divested (see Note E). On June 1, 2010, the Company divested its Powder Coatings business, including $4 million
of associated goodwill, and on October 1, 2010, the Company divested its Hydrocarbon Resins business, including $9 million
of associated goodwill. On November 30, 2011, the Company sold a Dow Automotive Systems product line, including $7
million of associated goodwill.