Closing of the $130 billion merger between US chemical majors Dow and DuPont now appears unlikely before late in the 2017 third quarter, DuPont CEO Ed Breen said in a conference call to present 2016 financial results. The CEO’s comments followed news that the European Commission has granted the prospective merger partners an additional 10 days to provide additional information that could allay the regulatory body’s concerns over crop innovation.

“My gut is we are in the second quarter” to complete the merger, Breen told journalists indicating later that it could be June. He said DuPont believes it can address EU concerns that the combination of the two portfolios would limit discovery of new agricultural pesticides, adding that the remedy will involve products as well as related research and development resource – a statement analysts understood to mean that divestments will be forthcoming.

Investors were evidently encouraged by the executive’s presentation of the outlook, as in New York trading the Wilmington, Delaware group’s shares rose on the news. Antitrust approval is also needed in China, Brazil and the US, The newly created company plans to split into three publicly traded units for Agriculture, Material Science and Specialty Chemicals with 18 months after the deal completes.

The EU has twice temporarily halted talks with the two US chemical groups, saying they had not provided sufficient information to allow a decision. Following a Jan. 9 meeting between Dow, DuPont and the EU, Competition Commissioner Margrethe Vestager said the outcome of the regulatory authority’s ongoing in-depth probe “is still very much open.”

In presenting financial reports for the fourth quarter of 2016 – which reportedly exceeded the analyst consensus – DuPont said earnings growth was boosted by a 9% drop in operating costs. The chemical group is in the process of shaving 10% off workforce numbers ahead of the planned merger, with an eye to reducing annual expenses by $730 million. Last year’s savings totaled $750 million, the company’s handout said. 

The merged chemical companies together intend to strip out an additional $3 billion in savings, including $300 million in R&D costs, but Breen said there are no plans to scrimp on new product development.

For the running Q1 2017, Breen forecast an 18% decline in net income, reflecting merger-related expenses. Operating profit is project to increase by around 8%.