Dow Chemical 2015 Annual Report Download - page 94

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Divestiture of ANGUS Chemical Company
On February 2, 2015, the Company sold ANGUS Chemical Company (“ANGUS”), part of the Performance Materials &
Chemicals segment, to Golden Gate Capital. The divestiture included the business headquarters and research and development
facility in Buffalo Grove, Illinois; manufacturing facilities located in Sterlington, Louisiana, and Ibbenbueren, Germany; a
packaging facility in Niagara Falls, New York; as well as the associated business, inventory, customer contracts, process
technology, business know-how and certain intellectual property. The sale was completed for $1.151 billion, net of working
capital adjustments, costs to sell and other transaction expenses, with proceeds subject to customary post-closing adjustments.
The proceeds included a $10 million note receivable included in "Noncurrent receivables" in the consolidated balance sheets.
Post-closing adjustments were finalized in the fourth quarter of 2015. In 2015, the Company recognized a pretax gain of
$682 million on the sale, including post-closing adjustments of $12 million. The gain was included in "Sundry income
(expense) - net" and reflected in the Performance Materials & Chemicals segment.
ANGUS Assets and Liabilities Divested on February 2, 2015
In millions
Current assets $ 124
Property 101
Goodwill 292
Deferred charges and other assets 8
Total assets divested $ 525
Current liabilities $ 17
Other noncurrent liabilities 37
Total liabilities divested $ 54
Components of accumulated other comprehensive loss divested $ 10
Net carrying value divested $ 481
The Company evaluated the divestiture of the ANGUS Chemical Company and determined it does not represent a strategic
shift that has a major effect on the Company’s operations and financial results and does not qualify as an individually
significant component of the Company. As a result, this divestiture was not reported as discontinued operations.
Divestiture of the AgroFresh Business
On July 31, 2015, the Company sold its AgroFresh business, part of the Agricultural Sciences segment, to Boulevard
Acquisition Corp., which was subsequently renamed AgroFresh Solutions, Inc. (“AFSI”). The divestiture included trade
receivables, inventory, property, customer lists, trademarks and certain intellectual property. The sale was completed for
$859 million, net of working capital adjustments, costs to sell and other transaction expenses, with proceeds subject to
customary post-closing adjustments. The proceeds included a $635 million cash payment; 17.5 million common shares of
AFSI, which represents a 35 percent equity interest, valued at $210 million based on the closing stock price on July 31, 2015,
and included in “Investment in nonconsolidated affiliates” in the consolidated balance sheets; and, a receivable for six million
warrants to purchase common shares of AFSI, which was valued at $14 million and classified as “Accounts and notes
receivable - other” in the consolidated balance sheets. The warrants will be received by the Company within nine months from
the closing date. The Company is also eligible to receive contingent consideration of $50 million, subject to certain
performance conditions. In addition, the Company has a tax receivable agreement with AFSI, where AFSI is obligated to share
with Dow potential tax savings associated with the purchase of the AgroFresh business. The Company has not recognized
either of these potential future payments as proceeds. See Notes 9 and 20 for further information on the Company’s equity
interest and variable interests in AFSI.
In 2015, the Company recognized a pretax gain of $626 million on the sale, including post-closing adjustments of $2 million,
of which $128 million relates to the Company's retained equity interest in AFSI. The pretax gain was included in "Sundry
income (expense) - net" and reflected in the Agricultural Sciences segment.