The companies announced in March they would form Dow Reichhold Specialty Latex LLC, pending FTC approval. The new company will focus on the $1 billion-plus specialty latex industry that produces everything from running tracks to gloves used in medical exams.
The joint venture will have access to a broad range of latex chemistries from both companies. The companies said terms of the transaction, which include Dow's acquisition of Reichhold's carpet and paper latex business, will not be disclosed.
"The new company is an attractive blend of the best resources of each company in the area of specialty latex," Reichhold's chief executive, Yoshi Kawashima, said in a statement.
Jeff Welker, former senior director of corporate planning for Reichhold, will be named president of the joint venture, which initially will be housed in Reichhold's building in Research Triangle Park. Welker joined Reichhold's RTP headquarters in 1996.
About 150 of the new company's employees will be based in its RTP headquarters. Most of the employees to fill the positions will transfer from Reichhold and Dow, with only a few new jobs created, a Reichhold spokeswoman said.
In March, the companies said about 100 of the new company's 400 total workers would come from Reichhold's RTP work force of 550. Almost all the other workers would be Reichhold employees who work in the company's manufacturing facilities in Georgia and Delaware. Only about 25 Dow employees would join the new company.
Other employees for the new venture will operate two latex production facilities in Cheswold, Del., and Chickamauga, Ga. Dow Reichhold Specialty Latex will have customers around the world and sales, marketing and research support in North America, Latin America, Europe and the Pacific region, according to a news release.
The joint venture represents a partnership between two of the world's largest chemical companies. Dow Chemical, which has annual sales of about $28 billion, is one of the world's top three chemical companies while Dainippon Ink and Chemicals, Reichhold's parent, is the 18th largest chemical company, according to a Dow spokeswoman. Reichhold generated $1.3 billion in sales in 1999 as a leading producer of adhesives, coatings and emulsions.