Dow Fires 2 It Says Held Talks to Sell Firm

Dow Chemical said it fired two executives yesterday for conducting unauthorized negotiations to sell the company.

J. Pedro Reinhard, who retired as chief financial officer in 2005 after 10 years but remained on staff as a senior adviser, and Romeo Kreinberg, executive vice president of performance businesses, "were engaged in business activity that was highly inappropriate," Dow said yesterday in a written statement. Kreinberg called the claims "unsubstantiated and unfounded."

Reinhard remains on the Dow board of directors because only a shareholder vote can remove him.

Dow shares rose on speculation that the company would receive a takeover bid by private-equity firms, challenging chief executive Andrew N. Liveris's desire to keep Dow independent. Kreinberg, who sat on a five-member executive-leadership committee with Liveris, said Dow accused him of conspiring with banks and foreign governments to acquire the company.

The board voted to fire both men yesterday morning following disclosure of the talks on April 10, the company said.

Dow shares rose 4.9 percent on April 9 after Britain's Sunday Express reported that U.S. buyout firms and investors from the Middle East were preparing a takeover bid of at least $50 billion.

"I had nothing to do with this rumor," Kreinberg said yesterday in a telephone interview. "Me and my colleague Mr. Reinhard have been used as scapegoats to finalize the last three months of takeover rumors."

Dow spokesman Chris Huntley said, "We have the information from a highly reliable source that would know what was going on and who we have absolute confidence in."

Reinhard and Kreinberg own more shares than anyone at Dow except Liveris, according to a March 23 regulatory filing.

Kreinberg said he was told Wednesday night to report to a 7 a.m. meeting at Dow's Midland, Mich., headquarters that included Liveris, two directors and two lawyers. They fired him after he refused to resign, Kreinberg said.

Reinhard, reached at Kreinberg's residence, said they were getting legal advice and declined to comment further.

Dow is more valuable as an integrated company, combining production of commodity chemicals with specialized products, such as automotive plastics, Liveris said this week.