Case | HBS Case Collection | November 2003 (Revised March 2006)

Dow Chemical's Bid for the Privatization of PBB in Argentina

by Mihir A. Desai and Alexandra de Royere


What price should Dow Chemical bid for PBB, a petrochemical complex that is being privatized by the Argentine government? To answer this question, students are forced to consider the role of country risk, the underlying currency exposure of the business, and how to value an investment opportunity that has several stages. Given that it is a privatization, students are also forced to consider the political dynamics involved, the incentives of local managers, and the bidding process of a privatization. The case provides detailed cash flows and discount rate information, allowing students to conduct a thorough valuation for an emerging markets project. To obtain executable spreadsheets (courseware), please contact our customer service department at

Keywords: Bids and Bidding; Privatization; Credit Derivatives and Swaps; Cash Flow; Emerging Markets; Valuation; Business and Government Relations; Multinational Firms and Management; Risk and Uncertainty; Energy Industry; Argentina;


Desai, Mihir A., and Alexandra de Royere. "Dow Chemical's Bid for the Privatization of PBB in Argentina." Harvard Business School Case 204-021, November 2003. (Revised March 2006.)