The European Commission has cleared the anti-trust hurdle for Dow Chemical Company's proposed acquisition of Rohm and Haas Co as the commission found it compatible with the European common market.

Dow Chemical, however, does not seem to be interested in the $18-billion Rohm & Haas acquisition, sources close to the developments said.

With the EC approval, Dow and Rohm only need clearance from the US Federal Trade Commission to close the deal. Analysts expect the FTC also won't stand in the way either.

Dow has only till 10 January to close the deal. If the merger is delayed, Dow will be forced to pay a "ticking fee" of $100 million per month to compensate Rohm shareholders.

Dow may not be able to fund the acquisition as it may find it difficult to raise money after a Kuwaiti government's last-minute decision to back out of a joint venture with the company's plastics' unit in West Asia.

Dow had hoped to raise a minimum of $7 billion from that joint venture to pay for the Rohm deal.

Dow is now trying sue the Kuwaiti government rather than stretch its own finances amidst tight money conditions and falling demand for its products (See: Dow Chemicals attempts to keep $15 billion bid for Rohm & Haas alive: report).

The regulators' has come as a setback for Dow as it binds it to the agreement. Had the regulators held back antitrust approval, Dow according to the agreement, could have walk away by paying a $750 million break-up fee.

The European Commission ruling, in fact, has taken away one chance of a lifeline from Dow Chemicals.

With annual sales of $54 billion and 46,000 employees worldwide, Dow is a diversified chemical company, offering a range of products and services  to customers in around 160 countries.