The Dow Chemical Company
Founded in 1897, the Midland, Michigan-based Dow Chemical Company is one of the world’s most influential corporations. With over 6,000 of Dow’s employees living and work in Michigan, the company is central to the state’s economy.
As a customer of the Midland Cogeneration Venture Limited Partnership (MCV), Dow had a unique relationship with MCV. In fact, it was the entity’s largest customer, as well as a 7.5 percent equity stakeholder. In November 2006, MCV was teetering on the edge of bankruptcy and, as a result, Dow faced a potential interruption in steam supply. If the supply of steam from MCV to Dow was interrupted for any length of time, Dow’s Michigan Operations would be jeopardized.
Dow retained Dilworth Paxson to assist it in positioning itself so that, if MCV filed bankruptcy, any disruption in steam to Dow’s facilities and Dow’s financial exposure would be minimal.
In June 2008, MCV once again became profitable and its general partner and the majority of its limited partners immediately decided to sell MCV’s operations. Dow, which has relationships with some of the country’s largest mergers and acquisitions law firms, decided to retain Dilworth as counsel through the divesture, due to the firm’s familiarity with the matter.
Dilworth’s representation of Dow essentially morphed from positioning Dow to withstand MCV’s potential bankruptcy to negotiating with MCV to maximize the amount Dow would be paid for the sale of its equity interest in MCV. The sale of MCV to the Swedish private equity firm of EQT Infrastructure and the U.S. energy investment group Fortistar was completed in May 2009.
Dow’s status as the largest customer and its interest as a limited partner put it in a unique position and Dilworth was successful in leveraging this position to help Dow secure more than it’s pro rata share of the profits from the sale of MCV and have its legal fees paid. More importantly, the sale reduced the risk of interruption to Dow’s supply of steam by ensuring MCV invested in several backup steam systems. This transaction demonstrated Dilworth’s ability to partner with Dow to achieve its goals efficiently and effectively. Dow remains a regular Dilworth client.