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Dow "might have trouble" buying Rohm & Haas without Kuwait cash: report

Dow "might have trouble" buying Philadelphia chemical maker Rohm and Haas now that it's lost the billions it was counting on from Kuwait investors, says credit analyst Sean Egan

UPDATE: "Rohm and Haas Company continues to work diligently towards completing the proposed transaction with Dow in early 2009," despite Kuwait's cancellation of a deal to invest billions in a joint venture with Dow, Philadelphia chemical maker Rohm said in a statement. Copy it into your browser:

EARLIER: "Kuwait canceled the purchase of a 50 percent stake in Dow Chemical Co.’s plastics making unit, depriving Dow of $9 billion it planned to use for the acquisition of Rohm and Haas Co.," reports Bloomberg News.

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Dow is "extremely disappointed", and is weighing its options.

Reuters gives background on why Kuwait cancelled Dow deal: "liberals" in Parliament challenged its viability.

Bloomberg: "Kuwait’s Supreme Petroleum Council reversed last month’s decision to approve the venture, to be called K-Dow Petrochemicals, the Midland, Michigan-based company said today in a statement... Dow now might have trouble raising the full $18 billion ($15B cash/$3B debt) to complete its purchase of Rohm and Haas, said Sean Egan, managing director of  Egan-Jones Ratings Co." in Berwyn. "Dow would pay $750 million (to Rohm and Haas) if it terminates the acquisition, Rohm and Haas said in a Sept. 29 regulatory filing."

On the other hand, "Dow would be able to complete the Rohm and Haas transaction even without the Kuwaiti money, (Dow CEO Andrew) Liveris said when the deal was announced," thanks to an investment by Berkshire Hathaway owner Warren Buffett and bridge loans from major banks.