Dow Chemical's rogue LBO negotiators

Dow Chemical Co. (NYSE: DOW) fired two top executives today. Why? They decided it would be fun to negotiate with private equity firms for a $50 billion leveraged buyout.

The problem, according to Reuters, is that the executives Romeo Kreinberg, executive vice president of Dow's performance plastics and chemicals operations, and Pedro Reinhard, a senior adviser and member of the board, decided to sell the company. According to Forbes, the executives avoided the media but spoke with "parties that were interested in the company." In short, the executives went behind the back of Dow's board to court potential suitors.

I have never heard of a couple of executives just deciding on their own to sell a public company. I would like to know how they got the idea to do this without obtaining approval of the company's board. If I were a Dow shareholder I would really be worried about whether management is supervising its employees.

Meanwhile, the market has rewarded Dow -- adding $1.05, or 2.33% to its stock price by midday.

Peter Cohan is President of Peter S. Cohan & Associates, a management consulting and venture capital firm. He also teaches management at Babson College and edits The Cohan Letter. He has no financial interest in Dow.