As I type, credit rating on DOW debt has been downgraded. If a fair market price for ROH cannot be renegotiated, then DOW must walk. There is no way Kuwait will ever pay $2.5 billion as the drop-dead deal date had not yet passed (12/31/08).
DOW doesn't need ROH at the ridiculously high price previously indicated.
Walking away and paying that 750m breakup fee is a lot cheaper.
At this point, there are plenty of other companies ready for takeover that are better than ROH.... although ROH has a near perfect growth track record.
I was NOT surprised when Kuwait decided not to continue with this agreement although I think they will regret not making the deal several years from now. I do agree with other posters there are other possibiliites out there for partnerships. One could be with a China company like SHI SNP or the like.