Failure with the Joint Venture

 Failure of the Joint Venture Article

Executive Synopsis

On November 28, 2008, The Dow Substance Company created a Partnership with State of Kuwait run Petrochemical Industries Organization (" PIC" ). " PIC” is a wholly possessed subsidiary of State owned or operated Kuwait Petroleum Corporation (" KPC" ). to start K-Dow Petrochemicals, a designed joint venture. PIC was to paid pay Dow $7. a few billion US dollars for its stake. The deal was approved by Kuwait's Supreme Petroleum Council (SPC). The top of the SPC is the Primary Minister of Kuwait The venture was going to manufacture and market polyethylene (PE), ethyleneamines, ethanolamines, thermoplastic-polymer (PP), and polycarbonate and related license and catalyst technologies. RAPID EJACULATIONATURE CLIMAX, and PP comprise more than half of world polymer demand. 2 With annual revenue of $54 billion and 46, 1000 employees worldwide, Dow is a diversified chemical substance company that combines the potency of science and technology with the " Individual Element ” to frequently improve precisely what is essential to human being progress. The corporation delivers a diverse range of products and services to customers in around one hundred sixty countries, linking chemistry and innovation with the principles of sustainability to assist provide many techniques from fresh water, meals and pharmaceuticals to paints, packaging and personal care products. Referrals to " Dow” and also the " Company” mean The Dow Substance Company as well as its consolidated subsidiaries unless normally expressly mentioned. 2 Within the Kuwait Petroleum Corporation family, PIC are at the center of the nationwide strategy to improve the value of Kuwait's hydrocarbon assets, and is focused on increasing the petrochemical advantages. It is focused on strategic expansion inside and out of doors Kuwait through diversification, additional use of proper alliances, and pursuing good joint ventures such as ASSOCIATE, GPIC and MEGlobal. two Kuwait Petroleum Corporation (KPC) is the state-owned entity responsible for Kuwait's hydrocarbon interests all over the world. As part of the global energy industry, we assist to supply the globe with its essential oil and gas requirements by exploring for, producing, refining, transporting and promoting these valuable natural methods both in each of our home country and internationally2

Almost immediately after the deal was signed, it began to meet with trouble as associates of the Kuwait Parliament sought to renegotiate the terms of the deal based on falling essential oil prices and met with personal obstacles while members of Kuwait's National Assembly voiced their objection to the deal. As such, The original value with the deal was cut simply by more than 8 percent simply by Kuwait.. State-Run Petrochemical Companies Co (PIC) then announced that it would just do it with the venture, in turn causing further anger among congress who right now said it absolutely was no longer practical in light from the global financial crisis and slumping petrochemicals sales and publicly asked the personal hobbies and ethics of users of the SPC and PIC. 3 Subsequent much argument with forward and backward accusations between Kuwaiti Parliamentarians and associates of the Kuwait's cabinet, the Kuwaiti Perfect Minister, under threat of parliamentary of questioning scrapped the deal with Dow Chemical substance on Dec 28, 08, effectively finishing what would have been a major politics confrontation involving the government plus the National Assembly.

On January 7, 2009 it was reported in the Kuwait Times that Dow Chemical substance will pursue legal action against the state-owned Kuwaiti business that pulled out of a partnership. Dow desires to15325 potentially recoup $2. five billion from Petrochemical Sectors Co under a contract terms.

Because of Kuwait backing out of the deal, Dow said it would lay off eleven percent of its work force, close twenty plants and divest many businesses. Dow had expected to get more than $7 billion in funds from the transaction, some of which could have helped purchase its $15. 3 billion dollars buyout of Philadelphia-based Rohm & Haas Co. Dow had also...


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