Midland, MI - The Dow Chemical Co. has reached agreements with Rohm and Haas and certain of its shareholders that permit Dow to close the acquisition on substantially altered financial terms. The agreement resolves the litigation initiated by Rohm and Haas against Dow.

As part of the agreement, Rohm and Haas's two largest shareholders have agreed to purchase $2.5 billion in face value of perpetual preferred equity issued by Dow. In addition, one of the shareholders, the Haas Family Trusts, has agreed that at Dow's option, it will make an investment in an additional $500 million of Dow's equity. These equity investments substantially reduce the debt financing required to fund the acquisition. Dow has restructured the transaction to essentially pay the equivalent of $63 per share in cash, and $15 per share in face value of preferred equity securities. To fund the acquisition of Rohm and Haas, Dow will use the proceeds from the equity issuances to reduce the amount it would otherwise be required to draw down from the $12.5 billion bridge loan, which was renegotiated to provide a one-year extension on $8 billion of the total loan. The financing for the acquisition also includes equity investments of $3 billion by Berkshire Hathaway and $1 billion by the Kuwait Investment Authority in the form of convertible preferred equity.