Earlier this week, news broke that E.I. du Pont de Nemours and Co. (NYSE: DD) and Dow Chemical Co. (NYSE: DOW) were in advanced merger talks. Of course, shares of both companies shot up about 12%. However, after the companies confirmed the merger of equals on Friday morning, both were giving back their gains in what seems to be incredible disappointment on the investor side.

The companies announced a unanimous approval for a definitive agreement under which the companies will combine in an all-stock merger of equals to form the combined company, DowDuPont. But it doesn’t stop there.

Subsequently, both parties intend to pursue a separation of DowDuPont into three independent, publicly traded companies through tax-free spin-offs. This would occur as soon as feasible, which is expected to be between 18 and 24 months following the close of the merger.

This raises a few questions. First and foremost, after the companies merge then split, which one will retain DuPont’s spot in the Dow Jones Industrial Average — if any of these three companies do — or whether this spot will be open to an outsider. The most recent change in the Dow came when Apple took the place of AT&T, which could imply another tech company filling DuPont’s spot, if it continues to go in that direction.

Another question is whether this deal can gain regulatory approval. These are two of the largest chemical companies on the market, and they are looking to form a $130 billion market cap powerhouse of a company. Granted, there is that split down the road.

Despite investors appearing disappointed with the fully revealed deal, Andrew N. Liveris, chairman and CEO of Dow Chemical, was overly positive:

This transaction is a game-changer for our industry and reflects the culmination of a vision we have had for more than a decade to bring together these two powerful innovation and material science leaders. Over the last decade our entire industry has experienced tectonic shifts as an evolving world presented complex challenges and opportunities – requiring each company to exercise foresight, agility and focus on execution. This transaction is a major accelerator in Dow’s ongoing transformation, and through this we are creating significant value and three powerful new companies. This merger of equals significantly enhances the growth profile for both companies, while driving value for all of our shareholders and our customers.

Shares of DuPont were last seen trading down 5.6% at $70.41 Friday morning, with a consensus analyst price target of $65.39 and a 52-week trading range of $47.11 to $76.59.

Dow Chemical shares were down 4.6% to $52.40, with a consensus price target of $56.11 and a 52-week range of $35.11 to $57.10.

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