Dow Chemical Company has announced that it would convert all of the Series A preferred stock worth $4 billion held by Warren Buffett's Berkshire Hathaway and Kuwait's sovereign wealth fund, into common equity.

Buffett bought 3 million preferred shares of Dow for $3 billion in April 2009, helping Dow finance its acquisition of chemical company Rohm & Haas, while Kuwait Investment Authority bought 1 million preferred shares of Dow for $1 billion.

The effective date of the conversion will be December 30, 2016.

On the company move, Andrew Liveris, Dow’s chairman and chief executive officer, said: "This milestone is the latest proof point of the strength, resilience and value creation of Dow’s business model – a narrower and deeper focus in attractive, consumer-driven end markets, compelling strategic growth investments, and continuous self-help productivity actions."

“It is also a clear illustration of our owners’ recognition and support of the company’s consistent earnings and cash flow growth, as well as our potential to deliver even greater shareholder value in both the near- and long-term,” he stated.

On the conversion date, holders of Series A preferred stock will be entitled to receive 24.2010 shares of common stock for each share of preferred stock, reflecting an approximate conversion price of $41.32 per share.

 The conversion of all four million shares of Series A preferred stock, will result in an additional 96.804 million shares of outstanding Dow common stock.

The Company will pay its last dividend on the Series A preferred stock on the conversion date for the quarter ending December 31.-TradeArabia News Service