Dow Chemical: A Private Equity Deal and Another Xenophobic Episode in the Making?

Rumors floated on the PE news circuit this past week that a consortium of Middle Easter investors and KKR are putting together a deal to buy out Dow Chemical Co for US $50 billion. This would be a huge PE deal, but not a terrible surprise given that pretty much any company with a market valuation below $100 billion is in the view of private equity buyers. This has been, in many ways, the private equity deal year with the dollar figures becoming larger every passing month.

But I do not concern myself with that – partly because I do not understand it as well. What I do understand though is that any time Middle East is mentioned in the United States, a red flag goes up in the eyes of some people, and like it or not, the hidden xenophobia towards Arabs reveals itself. This deal will probably not be very different. “Middle East investors” is not a term American politicians (some) will like very much, especially when it relates to the buy out of a firm that has some thing to do with markets that can fall within a broadly described category of “sensitive to national security”. Chemicals probably easily fall in that category, especially if the description of that term is stretched to the degree that I believe certain political forces will try to in the weeks and months to come.

This may be yet another Dubai Ports saga in the making! When that debacle occured I wrote:

What craziness from the so-called representatives of the American people! Shameful and quite unpatriotic. If their opposition to this deal is indeed due to the overwhelming number of calls from their constituents (which I highly doubt), then this should be a shameful realization of the protectionist racism that has infiltrated this society in the post 9-11 era. The rejection of this deal was not about security, it is just a blatant display of racism against Arabs (and probably Muslims in a wider context)

A trusted journalistic source, Daniel Primack of PEWire writes the following in his daily blog:

*** Dow Chemical Co. is downplaying buyout rumors, after a UK tabloid reported that KKR and several Middle Eastern investors are prepping a $50 billion bid. A company spokesman says that Dow has “no interest” in a leveraged buyout, because it believes it can provide the most shareholder value by remaining a public entity.

Now there are plenty of reasons to dismiss the story –for example,the same tabloid published a very similar reporttwo months ago – but “shareholder value” isn’t one of them. After all, this supposed bid would be at between $52 and $58 per share, whereas Dow hasn’t traded above $50 in years…

But my main interest this morning is in positing a political query – rather than a financial one. Let’s assume, for the sake of argument, that such an offer is indeed in the offing, and that the Dow board of directors accepts. The next issue to arise is not so much whether or not shareholders would accept (they would, after holding out for a few more bucks), but whether the United States would accept. You know, the special committee made up of talk radio and cable news denizens.

This is where I see the real problem. Not only would an American icon be taken over by Middle Eastern sheiks, but Dow does have some national security-related responsibilities (particularly in the broad, dependency sense). Plus, who knows when we’ll want to use napalm again…

For the record, I find such concerns to be ignorant at best, and xenophobic at worst. Ditto for the manufactured Dubai Ports World controversy last year. But I’m already seeing it expressed in various political blog posts… Certainly worth keeping an eye on. Discuss amongst yourselves

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8 Responses to Dow Chemical: A Private Equity Deal and Another Xenophobic Episode in the Making?

  1. Mario Marroquin says:

    You claim that Americans are xenophobic and you are right. Any group that comes to this country and is born here and does not consider themselves American and puts his ethnicticity and religion first does not earn the trust of Americans. You want to retain your laws from you homeland and live like you are still in the middle east I want to know what you are doing here. You want to retain your Arab culture in our America so why are you here? Trust is hard to earn and I don’t see Arabs trying to earn it.

  2. Bilal Zuberi says:

    Sounds like you quite like being a xenophobe. It is unfortunate.
    Really, Mario? Is anyone really trying to retain laws from some other part of the world? Please provide some evidence. I thought we were promoting American values elsewhere and not vice versa!
    Your America? wait – were you a part of a native tribe here that this is your America?
    And yes, trust is hard to earn, and America is fast losing trust it has built over the past 2 centuries if it continues to foster anger and fascism.

  3. Mario Marroquin says:

    Did I misread the news? More than 25% of native born Muslims think suicide bombings are ok if it helps Muslims. That alone is enough for anyone to mistrust Muslims. I know that you resent profiling of Muslims of Arab background but are we suppose to profile Swedes? I stand by what I said and when I see Muslims publicly condem your radicals I will start seeing you in a different light. (My great-grandfather was Yaki Apache).

  4. Mario Marroquin says:

    Bilal, what religion did the JFK terrorists belong to. Where is the outcry from your community? I think that it is you that is xenopohbic.

  5. Bilal Zuberi says:

    Mario: You bring such old news that I question why am I even responding to it. Should I point you to the Unabomber or the Oklahoma city bombing?
    Just so you know, most people captured in these “sting” operations when red alert has been raised are eventually released by the government. Isn’t that strange?
    Every few months a hoopla is raised, a big deal is mad eon TV (with NYC footage in background), law enforcement officials go on the talk show circuit touting how incredibly organized our security agencies have miraculously become…and then a few months later they say “oops, we are sorry” to the fellows and let them go scot free. Here’s a question: How many of these terrorist plotters have you seen go through courts and end up in jail? Here’s a suggestion: try reading below the headlines so you are not swayed by popular opinions.

  6. Mario Marroquin says:

    Have you heard of Robert Reid? How about the Michigan seven. I agree that our security likes to push pr. The fact still is that unless Muslims stand up to the radical Muslims you will still be on the don’t trust list. Maybe some one in your community will make a stand. You seem like you are afraid to speak up.

  7. Sara says:

    Is this discussion over? I hope not. Mario, although many of your comments are based on bits and pieces of what is going on in the world, I hope you realize that your comments merely foster more racism, hate and encourage stereotypes in this already messed up world.

    First of all, you talk about “Arabs” and “Muslims” like you know what you are talking about. Stop generalizing!! I have news for you, the majority of Arabs that immigrate to the United States are those looking to escape poverty, searching for business opportunities, an overall better quality of life, kind of like every other immigrant that moved to the U.S at one point!! Hence these Arabs that immigrate to the U.S are usually Palestinian, Lebanese, Syrian, Egyptian. They have very specific issues that are near and dear to their heart like, for example, the Palestinian/Israeli conflict (that sorry to say, not all Arabs associate with or care about). And yet ALL ARABS are stereotyped as anti-Jewish, anti-Israel. Is it that black and white? So many Americans trash big business, corporate conglomerates, big government in the U.S, so why don’t we think it is a big deal when large super-powers in the world crush powerless countries that can’t afford to defend themselves? Put all the politics aside, and sometimes if you focus on the human aspect of issues, what counts are basic human rights and common decency.

    Let’s be honest, many Arab-American immigrants (like most other minorities in the U.S) get picked on and bullied just like the Asian UVA student who shot up the university and then himself, and then Americans wonder, WHY? Why all this home-grown terror? Is this condoning these psycho acts? Of course not. I feel sorry for the innocent victims that happened to be in the wrong place at the wrong time, both also sorry for the sick people in the world that go so crazy that they would do something that crazy to begin with. But before we are quick to close the case and call these people crazy, let’s also try and understand what drove these people to the point that made them want to end their lives with such a desperate act? Suicide bombers, school-shootings, most of them have one thing in common. HATE. I don’t know when we will do a better job of teaching our children what picking on other kids can do to a child’s self-esteem.

    Back to the issue of Arab stereotype…. Other Arabs (Saudis, Kuwaitis, Omanis, Bahrainis, Emiraties for example) who don’t IMMIGRATE anywhere, because they don’t need to, are still victims of racial profiling because they are “Arab” and “Muslim”, which makes them want to teach the racist westerners a lesson, or at least make their voice be heard and they get caught up in the trap where someone has brainwashed them to believe what they are doing is in the name of some higher cause. It’s such a vicious cycle. Who is to be blamed? Do we place enough blame on societies and media that allow narrow-minded cultures to stereotype and generalize and hence be skeptical of everyone different? Of course, yet again, the end result is HATE.

    This disgusting radicalism is displayed by people who claim they are Muslim, and oh how subjective that is. If I go around calling myself Jewish or Christian and commit a bunch of messed up acts in the name of Judaism or Christianity, would people believe that those religions are responsible? HELL NO!! The propoganda on both sides needs to stop. Radical freaks need to stop calling themselves Muslim because they are not, the religion, as practically EVERY OTHER WORLD RELIGION, teaches tolerance not hate. It is our job as educated, rationale human beings to not be fooled by propaganda, not on the part of governments, communities or hate groups. All that really does is breed MORE RACISM.

    One last comment Mario, you are wrong about people in Arab and Muslim communities not speaking up. You might not hear about this in the States because real Arab causes are not discussed amongst the American public, but over here in the Middle East, people stand up to extremists and fundamentalists, and most sane people do not condone ANY act of terrorism!! But that also means we have to do our part by not condoning hate.

  8. Jaheim Redniw says:

    Dow is a racist company by design. Have you seen pictures and read profiles of their their “so called” global leaders and board of directors. They are experts in tokenism.

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