DuPont de Nemours plans to split into three independent public companies, the company announced on Wednesday.
The proposed shakeup would separate the chemical giant’s electronics and water businesses into individual entities, with what the company called “New DuPont” continuing to focus on materials science.
According to DuPont, dividing its electronics and water businesses will allow the companies to focus on different growth strategies, pursue M&A opportunities and entice investors. The separations are expected to take 18 months to two years to complete.
“After careful consideration, we concluded that operating these businesses as independent companies provides the best path for long-term value creation, and we believe that time to do it is now,” DuPont CEO and Executive Chairman Ed Breen said in a May 23 earnings call.
New company will focus on semiconductors
DuPont’s materials science business, currently dubbed New DuPont, will continue to focus on its safety and protection business brands such as Tyvek, Kevlar and Nomex.
New DuPont will also continue producing medical devices as well as packaging and biopharma consumables in the healthcare industry, the company’s current CFO and EVP Lori Koch said on the call. Moreover, the company will work on technologies within electric vehicle batteries, coatings and parts, targeting the global automotive as well as aerospace industries.
The electronics business will focus on semiconductor components and electronics in signal integrity, power management and thermal management.
DuPont has been putting a larger focus on semiconductors recently. In November 2023, DuPont opened a 120,000-square-foot plant in Newark, Delaware, which makes its Kalrez brand perfluoroelastomer sealing applications for its customers in the semiconductor and industrial markets.
“The company is perfectly positioned to benefit from the long-term drivers inherent in the electronics space including the emerging driver of artificial intelligence,” Koch told analysts. “We have long-term relationships with all key semiconductor and other electronics industry OEMs and a strong history of co-development and application engineering to ensure customer success.”
Meanwhile, the water business will focus on water filtration and purification technologies, serving customers in industrial water and energy, life sciences and specialties, municipal and desalination, and residential and commercial markets.
Breakup follows years of shakeups
DuPont has made several corporate restructuring moves in recent years. In 2017, E.I. du Pont de Nemours and Co., DuPont’s former formal company title and referred to as “Old DuPont” in court documents, merged with Dow Chemical Co. for $130 billion. At the time, the plan was to break up the conglomerate into three different businesses.
However, two years later, the conglomerate was dissolved and broken into three separate entities: DuPont de Nemours, a specialty products business referred to as “New DuPont”; Corteva, an agriculture business; and Dow, a materials science business.
In addition, Chemours, which produces Teflon used for non-stick pans, was spun off from “Old DuPont” as a separate entity in 2015 before the merger.
DuPont names new leadership
DuPont also appointed a new CEO and CFO.
Koch will succeed Breen as CEO, and Antonella Franzen, CFO of DuPont’s water and protection segment, will succeed Koch as CFO and SVP. Breen will stay with the company and transition to the role of full-time executive chairman.
The executive changes will take effect June 1.
Koch’s base salary will increase 60% from $750,000 to $1.2 million, according to a May 22 securities filing. Koch’s salary is also $200,000 more than Breen’s base salary, per the filing.
Meanwhile, Franzen will receive a $700,000 annual base salary when she begins her CFO role
