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Author: pauleckler Big funky green star, 20000 posts Top Favorite Fools Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 806  
Subject: Re: Olin Corp ? Date: 3/13/2014 11:49 AM
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The Dow Chemical discussion board is quite active and up to date. Last I heard an outside investor had suggested a larger spinoff, but Dow has resisted and plans to pursue its plan.

Dow's plan to unload those businesses in effect hangs a forsale sign on them. Interested companies usually come forward for a look, and sometimes get access to books for study under a secrecy agreement. If a suitable buyer comes forward, a deal will be done. If not, the business could be spun of as a separate company or sold in pieces to various buyers including the investors groups. A deal can come at any time, but it can take up to a year to work out all the details before it is announced.

Its possible that a possible spin off of metals and ammunition business is what makes Olin attractive to investors too.

Commodity chemical business are notoriously cyclical. They can be nicely profitable in boom times especially if shortages develop. In the bottoms, plants are difficult to slow down. Most are either on or off. And off means no income to cover overhead. So most continue to operate and sell at a loss if they must. Low cost producers, the largest companies can do ok, but competition makes margins low compared to other business lines like specialties.

Now that auto sales seem to have recovered and housing starts are coming back, PVC and chlorine demand and pricing should be attractive. So if you would unload these businesses, now is the time. You do not want to be selling them when demand is down.
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