Updated from 4:33 a.m. EST

Dow Chemical

(DOW) - Get Report

and

Rohm & Haas

(ROH)

are in talks to close their $15.4 billion merger, the companies announced Friday.

The Federal Trade Commission was the last authority sign-off required for the consummation of deal. FTC approval requires Dow to complete the takeover in two business days under the terms of the merger agreement.

Dow's acquisition of Philadelphia-based Rohm & Haas has been on hold since a Kuwaiti company backed out of a joint venture that would have helped Dow fund the acquisition.

European regulators approved the transaction earlier in January, without requiring divestitures.

Rohm & Haas shares were up $6.62, or almost 11%, to $67.08.Shares of Dow were trading Friday at $14.26, down 12 cents.

When the deal was first struck last July, Midland, Mich.-based Dow said the acquisition of Rohm & Haas and its specialty chemicals portfolio would give it a buffer against volatile commodities prices in the chemical market.

Commodity prices have since collapsed, and Wall Street has been reshaped by a financial crisis, raising questions about the true value of Rohm & Haas and whether Dow paid too much.

Dow's market cap has dropped sharply since July to about $13.2 billion, less than the $15.4 billion price it has agreed to pay for Rohm & Haas.

This article was written by a staff member of TheStreet.com. Copyright 2009 TheStreet.com Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed. AP contributed to this report.