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DowDuPont (DWDP) Unit Announces Outstanding Notes Redemption

DowDuPont Inc.’s DWDP subsidiary, The Dow Chemical Company, recently announced full redemption of its outstanding 8.55% Notes due 2019, issued post to an indenture dated May 1, 2008, supplemented by a first supplemental indenture dated as of Nov 30, 2018 between the company and The Bank of New York Mellon Trust Company as trustee.

Per the company, the amount of redemption in full will be equal to the principal amount of notes outstanding post expiration on Dec 4, 2018 of a five-day any and all tender offer for such notes, launched on Nov 28, 2018.

Per the terms of the indenture, the remaining outstanding notes will be redeemed in full on Dec 30, 2018 (redemption date) at a redemption price greater than or equal to 100% of the principal amount thereof or the sum of the present values of remaining payments of principal and interest thereon (excluding any portion of such interest payments accrued as of the redemption date), discounted to the redemption date semi-annually. It will be redeemed at the treasury rate along with 50 basis points (bps), as applicable, along with unpaid and accrued interest up to, but excluding, the redemption date.

Notably, upon the company’s payment of the redemption price and on the redemption date, all rights of holders with respect to the notes being redeemed will be terminated. However, this does not include the right to receive payment of the applicable redemption price upon surrender of the notes for redemption.  

DowDuPont’s shares have lost 13.8% in the past six months compared with the industry’s decline of 14.5%.


DowDuPont, during third-quarter 2018 earnings call, stated that it is seeing strong global demand for products on business investment, manufacturing output, job growth and wage increases. The company will continue to focus on driving the top line from above-GDP demand growth for products and new launches as well as delivering productivity and cost synergy savings.

DowDuPont achieved cost synergy savings of more than $450 million in the third quarter. The company raised cost synergy commitment to $3.6 billion from the previous expectations of $3.3 billion. Moreover, it raised year-over-year savings view for 2018 to $1.5 billion from $1.4 billion.

Zacks Rank & Stocks to Consider

DowDuPont currently carries a Zacks Rank #3 (Hold).

A few better-ranked stocks in the basic materials space include CF Industries Holdings, Inc. CF, Methanex Corporation MEOH and The Mosaic Company MOS, each sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here. 

CF Industries has an expected long-term earnings growth rate of 6%. The company’s shares have gained 14.3% in the past year.

Methanex has an expected long-term earnings growth rate of 15%. Its shares have moved up 2.7% in a year’s time.

Mosaic has an expected long-term earnings growth rate of 7%. The company’s shares have surged 51.9% in the past year.

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Dow Chemical Company (The) (DWDP) : Free Stock Analysis Report
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