Warren Buffett takes a long view and Dow Chemical is a Warren Buffett kind of business — mature, industrial, established, bricks rather than clicks. Still, there might be a touch of anxiety in Omaha, home of his Berkshire Hathaway investment company, over the future of Dow’s $15 billion agreement to buy Rohm and Haas.

Berkshire stepped up to the plate in July, offering to help to fund Dow’s purchase of the speciality chemicals group. Banks have not been helpful to corporate dealmakers this year, and Berkshire, weighed down with cash, has been filling the banks’ shoes, first propping up the Mars takeover of Wrigley and then trying to help out Dow.

Berkshire agreed to take $3 billion in Dow convertible preferred stock, while Kuwait Investment Authority was to invest $1 billion.

Since July the chemicals sector has been caught in a downward spiral of destocking, the evaporation of ordinary trade finance and plunging prices. It is now worse for Dow because the Kuwait petrochemical joint venture, which hit the buffers over the weekend, would not only have yielded some cash but would have reduced Dow’s exposure to plastics, such as polyethylene and polypropylene, whose prices have fallen by between a third and a half since the summer.

The question for Berkshire is whether it still wants to be on the Dow hook. Market reports suggest that it was offered a tasty 8.5 per cent yield and a slim 20 per cent convertible premium. Dow shares have fallen by 60 per cent since July. That may leave others with regrets over the sacking in April of two Dow executives who allegedly tried to negotiate a sale to Middle Eastern investors.

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