Dow Chemical Active With an Acquisition and Cost Saving Plan to Please Long-Term Shareholders

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Shares of The Dow Chemical Company (NYSE:DOW) are lower today by 3%. The Dow Chemical Co. is planning to purchase the remaining equity in Clean Filtration Technologies Inc. following two prior investments by Dow Venture Capital and joint research and development work in 2010. Typically, acquisitions or capital investments are a short-term negative with shareholders and a longer term value add as the integration comes to fruition. Last week, Dow announced a cost reduction plan that will save approximately $250 million annually. Dow Chemical also forecasted that approximately 900 positions will be eliminated worldwide, and in the first quarter, Dow will take charges totaling approximately $350 million for asset impairments and write-offs, severance and other costs related to these measures. Will Dow Chemical’s largest institutional investors wait for more clarity from the upcoming earnings release on April 25th?

572 institutional firms indicated owning shares of The Dow Chemical Company (NYSE:DOW) in both Q3 2011 and Q4 2011. These firms reported owning a total of 790.35 million shares on 09/30/2011 and 795.999 million shares on 12/31/2011. The shares closed at $22.11 on 09/30/2011 and $28.56 on 12/31/2011, for an aggregate market value of $17.475 billion and $22.734 billion, respectively.

Dow Chemical Earnings Cheat Sheet>>

Here are the ten largest positions in The Dow Chemical Company at the end of December 31st, 2011.

CAPITAL WORLD INVESTORS held 123,479,626 shares on 09/30/2011 which were worth $2,730,134,531. On 12/31/2011 the firm held 126,350,626 shares worth $3,608,573,879. This represented an increase of 2,871,000 shares or $878,439,348.

CAPITAL RESEARCH GLOBAL INVESTORS held 83,284,500 shares on 09/30/2011 which were worth $1,841,420,295. On 12/31/2011 the firm held 93,727,335 shares worth $2,676,852,688. This represented an increase of 10,442,835 shares or $835,432,393.

WELLINGTON MANAGEMENT CO LLP held 47,370,451 shares on 09/30/2011 which were worth $1,047,360,672. On 12/31/2011 the firm held 62,183,576 shares worth $1,775,962,931. This represented an increase of 14,813,125 shares or $728,602,259.

VANGUARD GROUP INC held 45,697,982 shares on 09/30/2011 which were worth $1,010,382,382. On 12/31/2011 the firm held 46,871,535 shares worth $1,338,651,040. This represented an increase of 1,173,553 shares or $328,268,658.

STATE STREET CORP held 42,460,347 shares on 09/30/2011 which were worth $938,798,272. On 12/31/2011 the firm held 42,521,242 shares worth $1,214,406,672. This represented an increase of 60,895 shares or $275,608,399.

DODGE & COX held 33,111,603 shares on 09/30/2011 which were worth $732,097,542. On 12/31/2011 the firm held 32,874,866 shares worth $938,906,173. This represented a reduction of 236,737 shares or $206,808,631.

BLACKROCK INSTITUTIONAL TRUST COMPANY N.A. held 29,424,146 shares on 09/30/2011 which were worth $650,567,868. On 12/31/2011 the firm held 30,578,909 shares worth $873,333,641. This represented an increase of 1,154,763 shares or $222,765,773.

NORTHERN TRUST CORP held 15,204,583 shares on 09/30/2011 which were worth $336,173,330. On 12/31/2011 the firm held 15,052,638 shares worth $429,903,341. This represented a reduction of 151,945 shares or $93,730,011.

FMR LLC held 19,002,306 shares on 09/30/2011 which were worth $420,140,986. On 12/31/2011 the firm held 14,704,301 shares worth $419,954,837. This represented a reduction of 4,298,005 shares or $186,149.

BANK OF NEW YORK MELLON CORP held 12,908,601 shares on 09/30/2011 which were worth $285,409,168. On 12/31/2011 the firm held 14,265,159 shares worth $407,412,941. This represented an increase of 1,356,558 shares or $122,003,773.

About the company: The Dow Chemical Company is a diversified chemical company that provides chemical, plastic, and agricultural products and services to various essential consumer markets. The Company serves customers in countries around the world in markets such as food, transportation,health and medicine, personal care, and construction.

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