As part of plans to "right size" its chlorine footprint to meet its needs in downstream markets, Dow Chemical said it will carve out "a significant portion" of its chlorine value chain over the next two years. Concretely, this will involve disposal of assets with $5 billion in annual revenue, including more than 40 production units at 11 sites employing nearly 2,000 people.

To facilitate a sale, the businesses will be broken up into three parts: epoxy, chlorinated organics and the North American chlor-alkali business.

Affected assets include the chlor-alkali and chlor-vinyls facilities at Plaquemine, Louisiana, and Freeport, Texas, U.S, including Dow's stake in the joint venture with Mitsui, which is currently building chlor-alkali facilities at Freeport. The global chlorinated organics production facilities at Freeport and Plaquemine as well as Stade, Germany, also are on the chopping block as is the global epoxy business with assets in the U.S., Germany, Italy, South Korea, China and Brazil. Supporting operations, including energy facilities, also are to go.

Altogether, Dow said it will shut down around 800,000 t/y of older chlorine and caustic soda capacity at Freeport, replacing volumes with output from the start-up of the joint venture with Mitsui in 2014.

The chemical giant has retained financial advisers to explore alternatives for the affected businesses, including joint ventures, spin-offs and divestitures. "Due to the highly integrated nature of the chlorine value chain, we are conscious not to leave any stranded costs or negative synergies," said executive vice president Jim Fitterling, who will oversee the separation process and transaction activities.

Explaining Dow's forward strategy, CEO Andrew Liveris said the plans reflect a continuation of the company's shift toward downstream high-margin products and technologies that generate higher returns. As a sales pitch, he added that apart from being market leaders, the assets up for sale are located in attractive regions and backed by a low-cost energy position attractive for producers of chlorine-based chemicals.