3M is NOT science

Sports, particularly in the US never seems to reach a limit in its attempts to increasingly commercialize itself. Stadiums used to have names with a history behind them, but now they are all named after corporate sponsors. And then there are all the "official" products, especially with NFL football, which range from the mundane (Courtyard by Marriott is the official hotel) to the strange (Bridgestone is the official tire - this is football, not auto racing) to the truly bizarre (Covergirl is the official beauty product line. Seriously? How many NFL players use Covergirl?)

But yesterday saw a new level of commercialization that first had me laughing but then got me quite made: 3M is now the "Official Science Partner" of the Minnesota Vikings. What does that even mean? Details are few, but it does appear that 3M's line of bandages will be available at the first aid stations around the stadium, and of course they get a banner in the stadium but beyond that, not much else is explained.

But think about this further. 3M ≠ science. Official Science Partner? How can someone or some company suddenly claim "science" for themselves and then use it for commercial gain? With the other "official" products and services that the league and teams have, the "official" product or service is something that the company actually sells. 3M, however, does not sell science. They sell Post-It notes and sticky tapes and cleaning supplies and respirators and tens of thousands of other products, but they do not sell science. Call their toll-free number (1-800-3MHELPS) and tell that you want to buy some science and could they forward you to the proper salesperson.

Science is not for sale [1] and no one is in charge of selling it. So for 3M to suddenly equate itself with science and then leverage it for profit is maddening. How long until this cashing in with the name of science spreads to other sports, not just with a single team, but at a league level? What if Monsanto wanted to the be official science partner to the Premier League? Or if Amgen wanted to be the official science partner to cycling? (Oh wait, they already are [2].) To cloak a company within the good cloth of science is just too much for me.

Unfortunately, science as a term has no legitimate defenders. I can't see any legal recourse available. Even showing standing would be a nightmare, let alone damages. Short of an organized social media campaign putting pressure on the Vikings and/or 3M, I think this is the future and we are stuck with it.


[1] Publishers of non-open-access journals make me think otherwise at times

[2] I'm looking at you, Lance Armstrong.

Previous Years

May 19, 2014 - A Portfolio of Biobased PE and PP

May 19, 2010 - Back in the Office

May 19, 2009 - Accelerated aging gets even faster

Even the Megacorporations can be defrauded

While it is very common to read reports of individuals falling victim to fraudulent internet and email schemes, it is much less common to hear of businesses being scammed, especially very large businesses. But apparently that has happened with LG Chem and Saudi Aramco (the latter arguably be the largest company in the world). Plastemart reported last week that LG Chem was supposed to wire $21 million to Aramco as payment for some petroleum distillates that they had ordered. But things fell apart when LG Chem received an email detailing a "new" account number to wire the money too. The "new" account, as you might now guess, was not an account that belonged to Aramco.

This reeks of an inside job - someone not only had access to Aramco's email system but also knew that LG Chem was supposed to be making the payment, so the list of suspects is probably pretty short.

We've not actually seen the email that LG Chem claimed they received, so we just have to trust that the letter did indeed supply a new account number. OR maybe, just maybe, it might have started like this:

"Dear LG Chem,

You may not believe your luck, but I am His Royal Highness, Sheikh Abdul al Abdul and I have $773 millions dollars in a Nigerian bank account and I urgently need your help..."

Previous Years

May 16, 2014 - The New Wonder Polymer

May 16, 2013 - Buy & Selling Division in the Polymer Industry

May 16, 2012 - Time to Test My Beliefs

May 16, 2011 - Updating the Blogroll

May 16, 2011 - Definitely Updating the Blog Roll

What was Justice Scalia worth? At least $835 million

The recent passing of Supreme Court Justice Antonin Scalia has been commented on heavily elsewhere, and I doubt I have any original thoughts to add. But is quite readily apparent that his replacement will not be appointed quickly, as in it might well drag on into 2017. The court has 9 members and voting on cases is strictly a majority-rules affair, so to have only 8-members means that not a lot of cases will be overturned in the near future. Getting a 5-4 vote for overturning a case is easier than get a 5-3 vote. For someone who's case is unfortunate enough to be on the calendar in the near future, that could seriously change the outcome.

One such case involves Dow Chemical, who almost three years ago was found guilty of price fixing and fined $1.2 billion. After many filings, motions and appeals, their case finally made it to the Supreme Court - and then Justice Scalia dies. To say that Dow thought they stood a chance with Scalia alive-and-well is quite clear, as they have now quickly negotiated a a final settlement for $835 million, still a mighty big chunk of change.

Dow stated in a press release:

"Growing political uncertainties due to recent events within the Supreme Court and increased likelihood for unfavorable outcomes for business involved in class action suits have changed Dow�s risk assessment of the situation."

Looks like Dow should have taken out a life insurance policy on Scalia. Even having a $2- or $3-hundred million would have helped offset this bitter pill.

Or as I suggested long ago, they could have settled early on for peanuts. Bayer (now Covestro), BASF and Huntsman paid a combined fine of only $140 million, but Dow bet on it's legal team and their analysis.

I imagine that the impending merger of Dow with Dupont also played a role. While large corporations will always have some legal actions against them at any point in time, the risk these actions pose is generally small. This case was quite different, and so having it settled - for better or worse - is always preferable to having an unknown quantity hanging over their heads as they enter into a merger.

Previous Years

March 1, 2013 - Giving the Skin Off My Back

March 1, 2011 - A Crack Smoking Poodle

March 1, 2010 - Unusual Recyling Mix

March 1, 2007 - Detox via Intox

Time for a Cage Match

Apologies to the fans fan of this blog (Hi Mom!) for not posting in such a long time. Between Thanksgiving and winding up the school term, it's been pretty haywire. But the final exam has been written, (not proctored - that comes Wednesday) and then it's just a matter of final grades, although I am taking advantage of the break to start working on lecture notes for next semester.

But I have a great welcome back item - the announced merger of Dow and DuPont. Both of these companies have a lot in common. They are both huge. Their names both start with the letter "D". And they both have had to put up with activist investors in the last year or two.

Dow was the first to be attacked from "within", in this case by Daniel Loeb (1, 2, 3, 4, 5 and 6). That all ended when Dow and Loeb and declared a truce just over a year-ago. In a classic case of monkey-see, monkey-do (a phrase that in this case insults monkeys, even really dumb monkeys), Dupont was then attacked from within by Nelson Peltz (1, 2, 3 and 4) before finally losing his proxy battle.

But both of these guys are still hanging around the picture, which then raises the biggest question in my mind about the merger: which activist investor will be the top dog afterwards? Everyone is far more concerned concerned about government approval for the deal, but what about the undercard: Loeb vs. Peltz? As big as this new company will be, it still will not be big enough for these two mega-egos. One of them will have to go.

My proposal: a cage match!

Which company had the better activist investor? This would be the once-in-a-lifetime chance to find out. Imagine the pay-per-view revenue. Wall Street bankers, financiers and countless C-Executives (especially ones previously harassed by these two) would pay thousands to watch this. Mayweather vs. Pacquiaou pulled in $410 millions - this could double that and give me enough cash that I could become an activist investor! The bookies would have Loeb as the early favorite as he is a sprite 53 years (turning 54 later this week) while Peltz is almost 20 years his senior, but when big money like this is at stake, these guys would be as ferocious as 2 emaciated tigers fighting over a fattened lamb.

"Grace, get me Loeb on the phone right away. Oh, and start dialing up that Peltz guy too. We're going to do lunch..."

Previous Years

December 14, 2012 - Changes. Big Changes.

December 14, 2011 - Isolating Thixotropy from Shear Thinning

December 14, 2010 - Will the Supreme Court become Probabilistic?

December 14, 2010 - Epoxy Resin Drop as Art - and Rheology Puzzler

December 14, 2009 - LyondellBasell to go East?

December 14, 2009 - Thermal Hystersis

Dull-and-Boring News Items

Sometimes dull-and-boring is good, sometimes it is bad. Here's an example of each regarding recent news items about Dow Chemical:

1. Their latest earnings continue to look good. I especially like the poke that this article takes at the activist-investor Daniel Loeb. He's still around? When is that guy going to take his ball and go home? Regardless, a profitable earnings reports is dull, but good.

2. The Dow chemists have been working hard and have developed a new plastic for Dow to sell. With as many chemists as Dow has, you would expect it to be some gee-whiz polymer with potentially mind-blowing chemistry and great potential to replace non-plastic materials with plastic. So what is it? An LLDPE (linear low-density polyethylene). LLDPE is actually a comonomer of ethylene and α-olefins. LLDPE's have been around for decades so this is hardly exciting or novel. But as the article notes, Dow's last major product introduction was in 2013 and was also olefin-based. What else would you expect when your former Chief Technology Officer goes on the record saying that "...[no] new polymers would be discovered, since chemists already had done a thorough job in finding ways to link carbon, oxygen, hydrogen, nitrogen and sulfur atoms."

This definitely is in the dull-and-bad category. Hopefully the current CTO has a better outlook on product development.

Previous Years

October 29, 2014 - Comparing Burger Chains and Oil Companies

October 29, 2013 - A New Chemistry Lab Building, But Without New Chemistry Jobs

October 29, 2012 - More Open Access articles in Polymers and Rheology

October 29, 2010 - Garbage Patch Vacuum Cleaners

October 29, 2010 - Good Advice

October 29, 2010 - UV Scale-up

What's in a Name? Marketing Gobbledygook #2

Last year, Bayer announced that it would spin off it's business group that supplies polycarbonates, polyurethanes and their components and also adhesives and coatings, a unit currently called Bayer MaterialScience (yes, there is no space between Material and Science). Since they will no longer be part of Bayer, the name needs to be changed. It was announced last week that the new name would be Covestro. And of course, such a name needs an explanation and they have a doozy of one:

"The name Covestro is made from a combination of words that reflect the identity of the new company. The letters C and O come from collaboration, while VEST signifies the company is well invested in state-of-the-art manufacturing facilities. The final letters, STRO, show the company is strong. It is strong in innovation, strong in the market and with a strong workforce."

Some questions:

• Doesn't this "explanation" suggests that the company should really be called Coveststro, not Covestro?
• Why choose a name that can only be explained in English?
• Doesn't this just reek of being a poorly constructed backroynm?

This explanation is almost as bad as the one given a few years ago when Stryon was spun-off from Dow Chemical to become Trinseo. I think we can rest assured that both these names were decided by some overpaid outfit that sat around sipping Chardonnay, coming up with new, fun sounding names and then pasting together a horrible backstory for them all while receiving a huge paycheck and being nominated for industry awards.

Don't believe me? Well it's too early in the morning for the Chardonnay, but let me show you how it's done. And to make it tougher, let's go with Sheldon Cooper's favorite word, Bazinga!

"The "BA" comes from Bayer, where the company came from; the "Z" is from the last letter of the alphabet, meaning that the company will last; the "IN" stands for intelligent, which is what all our customers, suppliers and employees are; and the "NGA" comes from lasagna, and who doesn't love lasagna?"

Don't laugh. This is no worse than the explanation for Covestro and Trinseo, and anyone who thinks otherwise can comment below, but only if they assure me that they can actually write their arguments without laughing. Besides, it only took 2 minutes start to finish. Can I collect my multimillion dollar paycheck now?

The worst part about all of these poorly constructed names is that they are (supposedly) derived from words that management types like, but not the practicing chemists. Do we really care about a company being "well invested in state-of-the-art manufacturing facilities"? Let's try devising a name starting with what we all really want from the company in the first place: great, cheap chemicals. "Greachchem" is an easy start, but now let's marketize it some. We have a "chch" in there which we can reduce to just one making it "Greachem". Good, but not sexy enough. Change the "ch" to an "x" to make it "Greaxem". But why stop with one "x"? After all, ExxonMobil and Lanxxess didn't, so let's double it up to "Greaxxem". Or do we go all the way with making it sexy and call our new company "Greaxxxem"? Best of all, google searches for any version of this (1, 2 or 3 X's) show that we have a new name without any prior users. Success! and this was even faster than explaining Bazinga. Now all we need is a cheesy stock photo for a logo maybe with a Texas carbon or two and we're ready to take over the chemical industry:

Devising a company name for "overpaid, underworked chemists" and "on-time delivery without excess packaging" are left as an exercise for the interested student.

Previous Years

June 10, 2014 - Hillary woos the plastics industry

June 10, 2013 - The Future of Sustainable Polymers: Bio-based Monomers or Polymers?

June 10, 2011 - Have You Considered a Career in Plastics?

June 10, 2011 - The Supreme Court Decides On Freebase Cocaine

June 10, 2010 - Pull Up a Chair

June 10, 2009 - Another Journal Scandal

Trian vs. DuPont - Round 3

Nelson Peltz and his Trian Partners Group is still dogging DuPont. Having lost the last round (when DuPont explicitly told him that no, he cannot be on the board of directors and that DuPont was going instead add 2 more of directors of their own choosing), Peltz is still hoping a proxy fight will get him the directorship he so craves. And just like what Daniel Loeb did when he was attacking Dow, Peltz now has his own website, dupontcanbegreat.com [*]. His nominees for 3 other director chairs are rather scary, all being financial guys. (It takes more than fancy financial manipulations to effectively manage a company. See Google, Apple, Amazon, IBM and 3M for counterexamples. See Enron, Bears Stearn and Bernie Madoff for examples of how financial numbers that look great can end up being a complete fraud.) But even more so, I wonder about Peltz himself.

His only experience in running a chemical-type company was Avery from 1984 until 1992 and the results weren't too impressive. In early January of 1984, Avery stock was around $6.50 while at the end of 1992, it was around $13.88. While a 214% gain seems impressive, the S & P 500 rose 260% during that same time frame. Meaning he couldn't even keep pace with the general market. I think Peltz would call that underperformance, but he still thinks he has great advice on how to run DuPont.

Again, I don't follow DuPont's business performance too closely and maybe they do deserve to improve, but I really am bothered by this activist investor approach. If you own stock in a company that is stinking up the joint, then you may try and hype it up some in order to get the price to rise. But the activist investors aren't hyping up DuPont. They are trashing it in about every way possible. All of which raises this question:

"If the company is really that badly off, then why would anyone ever buy up such a large share of it?"

[*] Dupontcanbegreat.com? Couldn't someone have spent more than a few seconds coming up with that grade-school level name? And these guys think they have great advice on how to run the company?

Previous Years

February 17, 2012 - Reusing Old CD's - but for Artists Only

February 17, 2011 - A Single Phase Gel from Buckyballs?

February 17, 2010 - Potpurri

February 17, 2010 - Twitter

The Most Egotistical of All the Activist Investors

While I would broadly claim that activist investors, with their penchant for running media campaigns putting themselves at the center of attention (and not the supposed problems with their targeted company), are egotistical, Nelson Peltz of Trian Management has raised the bar to a new level. You may recall from a month ago that Peltz took a small position in DuPont and started demanding changes, including having 4 of his directors put on DuPont's Board of Directors. One of the initial recommendations was Peltz himself. Fine, whatever. But that actually now appears to have been not only a request, but his highest demand. DuPont met with Peltz and agreed to let him have a director on the board, as long as it wasn't Peltz. No deal! Peltz insisted that he be the director or he was going to go home and hold his breath. Such an ego! What is so special in the little brain of this guy that he and he alone has to communicate it?

DuPont was quite fine to let him storm off as they immediately afterwards added 2 directors of their own choosing. Geesh Nelson, you could have had 1, but now you have nothing, and the board is that much bigger and more loaded with people favorable to the current management, so that you can even could consider that as a -2, meaning that the score for you suddenly swung by -3 in your direction. And you think you know how to run a company?

Esteemed fellow blogger Chemjobber pointed out to me a couple 1 and 2 articles in the Economist that give an alternate perspective of activist investors. They are well written and do provide an alternative perspective, but I'm having none of it because the articles tacitly assume that all this activism is unquestionably good and that these are good individuals that know what they are doing. Huh? So if you are an activist investor you are automatically qualified as competent? No other field on earth makes that claim. There are bad doctors, lawyers, cops, engineers, chemists, CEOs, teachers, professors, janitors, receptionists, salespeople, actors, singers, athletes and so forth, but bad activist investors? No, they are all quite skilled at their jobs.

Previous Years
February 10, 2012 - Birds and Gels and Arsenic

February 10, 2012 - A Sign Your Oven Might Not Be Working Properly

February 10, 2010 - Valentine's Day is Coming...

Falling Oil Prices and ExxonMobil

I've been preaching for a while about how ExxonMobil is incorrectly blamed for any and all possible problems around the world that can be connected to our modern petroleum-consuming economies. While ExxonMobil may indeed be at fault for many of these accused problems either directly or indirectly, I again want to emphasize that they are a small fish in a large ocean.

Look at the recent price drop in petroleum around the world. ExxonMobil has nothing to do with this, and in fact, the low prices are hurting them. Revenues are dropping, investments are dropping and their stock price is dropping. Is anyone saying ExxonMobil is responsible for the low prices? Or si the blame being put on Saudi Arabia, whose National Oil Company, Saudi Aramco, has the largest reserves in the world, and who isn't cutting production?

People being people, ExxonMobil will again be vilified when prices do increase and their profits follow. No one will blame Saudi Aramco, and our profound, collective ignorance of the true dynamics of the petroleum industry will continue.

Previous Years

January 15, 2013 - Assault with a Deadly Hair Removal Gel

Monkey see, monkey do

Back in November, Dow Chemical was able to reach a truce with their "activist investor" Daniel Loeb of Third Point LLC., by letting Third Point put two of their people on the Dow Chemical Board of Directors. (In a rather intelligent move, Dow Chemical also added 2 additional directors so there are now 14 total. Had Loeb won his proxy fight, his 2 directors would have been 2/10 = 20% of the board. Now they are 2/14 = 14%. It may have been awhile since Dow's CEO was at the bench, but he certainly understands dilution to this day.)

The other large US-based chemical company whose name also starts with with the letter "D" is now in a similar fight with an activist investor, in this case Nelson Peltz and his company Trian Investors. No doubt emboldened by Loeb's (dubious) success, guess what Peltz wants? You got it - he wants to put directors on Dupont's board! Peltz obviously has a little more time on his hands than Loeb does, as Peltz wants to be one of the directors, while Loeb was quite content to let his cohorts have that role.

Dupont's Board is already 14 members and Peltz is running a slate of four candidates. If they all win, they would make up almost 4/14 = 29% of the Board. Or maybe Dupont can copy what Dow did and let Peltz put two on the board while Dupont adds two more, in which case Peltz will only control 2/18 = 11% of the Board. That would be a significant swing.

I've not followed Dupont's business closely, so they may or may not be deserving of a kick in the pants to wake them up, but activist investors never sit well with me. They strike me as too much grandstanding and publicity seeking and not having enough focus on rational thought. Such behavior is typical for politicians. I don't approve of it from either group.

Previous Years

January 14, 2014 - Finally a Commercial Phosphorus Polymer?

January 14, 2010 - A Viscoelastic Surface for People, too!

January 14, 2010 - Recycling Plastics

Dow Chemical and Third Point reach a ceasefire

The Polyurethane Blog is reporting that Dow Chemical and Dan Loeb, the activist investor and operator of Third Point LLC., have reached a ceasefire. Loeb will lay down his weapons for a full year including taking down his flashy website [1]. On the other side, Dow will add to the Board of Directors the two candidates that Loeb wanted plus two more directors. Since the current Board of Directors is the CEO Liveris and 9 others, there will now be a 14 directors total. If Loeb had won the proxy fight, his 2 directors would have been 20% of the board. Now he has to be content with 2 out of 14 (14%). That's called dilution.

So we shall now wait and see if the ceasefire holds [2]. It is possible that the board may start causing issues for the CEO, although it is doubtful we will ever find out much about such internal fighting unless the new guys decide to kiss-and-tell. The old board members are probably too loyal to cause much trouble. Such is the case whenever the CEO is also the Chairman of the Board, which is pretty always the case.


[1] Yep, the site is totally gone. 404. Not even a note saying that the site was taken down.

[2] So now what I am going to blog about, especially regarding Dow Chemical? Geesh, Loeb was great for providing bloggable material. Well, there are the ongoing appeals over the price-fixing scheme that Dow was found guilty of. They are now trying going to the Supreme Court (lots of luck with getting them to take the case).

Previous Years

NOvember 21, 2011 - Throwing Away Books

Is Dow Chemical going to have a proxy fight?

Every time I keep thinking that Dow Chemical may have finally been able to tell activist investor Daniel Loeb to take a hike, he keeps coming back. What a glutton for punishment.

Loeb's latest effort is this flashy website which makes yet another logically inconsistent attempt to acheive changes that he desires at Dow. This website is designed to inform stockholders of his opinions and push for a proxy fight to get two of his handpicked directors on the board.

I'm guessing that Loeb hopes that the impressive visuals of the website will hide the desperateness of his throw-everything-I-can-think-of-and-hope-something-sticks approach. He's using performance issues from as far back as 2006 to justify his proposal. Such an approach always generates internal inconsistencies, such as his insistence that Dow is a petrochemical company [1], and yet when comparing performance to other companies lists not a single petrochemical company [2]. Strange, isn't it? I could go on list lots of other inconsistencies, but what's the point? He's looking to fool naive investors and nothing more.

I've pointed out in the past that Loeb has forgotten his calculus (shame on him, as his degree was in economics), but it also looks like he could use a little help with his organic chemistry:

This image is also from the bottom of the "Facts" tab. It seems like a mashup of molecules, so I won't fault him for the images overlapping poorly, but it does have some fragments that are begging for a keto-enol rearrangement. At least the webpage lacks those slow-motion videos of Liveris that make him look stupid/arrogant/insensitive such as we see in our political ads.

It's not as if I am a big fan of Dow. I've lodged lots of complaints against Dow Chemical on this blog, but I really dislike the approach that Loeb is taking. He's looking to cash in on a short-term investment and then leave to cause trouble elsewhere. The chemical industry has enough problems without having to worry about this type of "activism". Fortunately, proxy fights seldom succeed unless a company is really in trouble. Dow isn't, as the most recent results show, so I expect this to (once again) change nothing.


[1] As seen at the bottom of the "Facts" tab.

[2] As seen on the "Underperformance" tab

Previous Years

November 14, 2011 - An Extreme Connection between Fracking and America's Cup

Dow Chemical's Earnings Keep Improving

Dow Chemical has announced their 3rd quarter earnings and as passed along by the Urethane Blog, they are up nicely.

"EBITDA(3) grew to $2.3 billion, up 24 percent versus the prior year, driven by ongoing productivity actions and improved market fundamentals. Performance Plastics achieved record quarterly adjusted EBITDA results (up 31 percent versus the year-ago period). Performance Materials EBITDA grew 61 percent with increases in most businesses, notably in Polyurethanes and PO/PG. Electronic and Functional Materials also delivered record quarterly EBITDA (up 11 percent)"

Normally I don't comment much on earnings reports, but this year has been different ever since the activist investor Daniel Loeb took up a stake in the company back in January. Unfortunately for Loeb, the company has been doing very well since then, providing plenty of egg for him to wipe off his face, such as that great earnings report that came out just 6 days after his initial critical comments. But might be expected for someone who has forgotten their calculus lessons.

Somehow I don't think Loeb will be commenting anytime soon (other than to announce that he threw his arm out trying to pat himself on the back for the great job he did in improving Dow's performance since January).

Previous Years

October 22, 2013 - October 22, 2013 -

October 22, 2012 - White Isn't Always White

October 22, 2010 - Thoughts on Losing Electricity

October 22, 2010 - Plastics - They Have a Future, but no Futures

October 22, 2010 - It's Not Easy Being Green

Yet more activist investors thinking they can run a chemical business

I've been writing a fair amount this past year about Daniel Loeb and his efforts as an activist investor to tell Dow Chemical's CEO how to run his business (1, 2, 3, and 4).

Since Dow is doing so well (no doubt as a direct result of Loeb's guidance (/sarcasm_off), Loeb is looking for a new place to produce similar results, now setting his sights oversee on DSM. He wants DSM to sell off the low profit plastics business and focus exclusively on the baby food and nutrition supplements business which operates at much higher margins. In other words, he want to be able to cherry pick and be appreciated as a business genius for doing so. While it might be easier to divide up the DSM pie than the Dow Chemical pie (i.e., there is less overlap between different operating units within the company), to say that this will "create value" is something I don't see. (A + B) = A + B. This is a really simplistic example of the associative property, but we've seen in the past the Loeb isn't very good at math.

And lest you think that Loeb is the only one being a pain in the posterior for the chemical industry, think again. C & E News reported a few weeks ago that Dupont has their own activist investor complaining to management. Such are the times we live in. If you have a stack of cash, you can get Wall Street to listen to you even if you are full of skatole-type compounds.

Previous Years

(Nothing)