VARIABLE INTEREST ENTITIES

9 Months Ended

Sep. 30, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

VARIABLE INTEREST ENTITIES

VARIABLE INTEREST ENTITIES

A summary of the Company's variable interest entities ("VIEs") can be found in Note 25 to the Consolidated Financial Statements included in Dow Inc. and TDCC's 2018 10-K Recast filed with the SEC on July 25, 2019.

Assets and Liabilities of Consolidated VIEs

The Company's consolidated financial statements include the assets, liabilities and results of operations of VIEs for which the Company is the primary beneficiary. The other equity holders’ interests are reflected in “Net income attributable to noncontrolling interests” in the consolidated statements of income and "Noncontrolling interests" in the consolidated balance sheets.

The following table summarizes the carrying amounts of these entities' assets and liabilities included in the Company’s consolidated balance sheets at September 30, 2019 and December 31, 2018:

Assets and Liabilities of Consolidated VIEs	Sep 30, 2019		Dec 31, 2018
In millions
Cash and cash equivalents	$	36	$	71
Other current assets	104		101
Net property	621		683
Other noncurrent assets	23		14
Total assets 1	$	784	$	869
Current liabilities	$	397	$	307
Long-term debt	44		75
Other noncurrent obligations	23		14
Total liabilities 2	$	464	$	396

1. All assets were restricted at September 30, 2019 and December 31, 2018.

2. All liabilities were nonrecourse at September 30, 2019 and December 31, 2018.

Amounts presented in the consolidated balance sheets and the table above as restricted assets or nonrecourse obligations relating to consolidated VIEs at September 30, 2019 and December 31, 2018 are adjusted for intercompany eliminations and parental guarantees.

The Company was a 50 percent indirect owner in a propylene oxide ("PO") manufacturing joint venture in Asia Pacific. The Company had a variable interest in this joint venture relating to arrangements between the joint venture and the Company involving the majority of the output on take-or-pay terms, with pricing ensuring a guaranteed return to the joint venture. On April 30, 2019, the Company executed an agreement to acquire full ownership in the PO manufacturing joint venture. The transaction closed on October 1, 2019, for a cash purchase price of $331 million. Approximately half of the purchase price was attributed to the Company’s proportionate equity interest in the entity that owned the PO manufacturing joint venture, which is accounted for under the equity method of accounting.

Nonconsolidated VIEs

The following table summarizes the carrying amounts of assets included in the consolidated balance sheets at September 30, 2019 and December 31, 2018, related to variable interests in joint ventures or entities for which the Company is not the primary beneficiary. The Company's maximum exposure to loss is the same as the carrying amounts.

Carrying Amounts of Assets Related to Nonconsolidated VIEs		Sep 30, 2019		Dec 31, 2018
In millions	Description of asset
Silicon joint ventures	Equity method investments 1	$	100	$	100
AgroFresh Solutions, Inc.	Equity method investment 1	$	36	$	48
	Other receivable 2	$	8	$	8

1. Classified as "Investment in nonconsolidated affiliates" in the consolidated balance sheets.

2.

Classified as "Accounts and notes receivable - Other" in the consolidated balance sheets.