DuPont de Nemours, a multinational chemical company with roots dating back to 1802, announced plans to split into three separate publicly traded companies. The company aims to spin off its electronics and water businesses into their own entities, which will be tax-free to shareholders. The breakup transactions are expected to be completed within the next 18 to 24 months, pending final approval by DuPont’s board of directors. Additionally, DuPont’s chief financial officer, Lori Koch, will take over as CEO effective June 1, while current CEO Ed Breen will remain as executive chairman. Koch will continue as CEO of the new, smaller DuPont after the spin-offs are finalized.
This decision by DuPont to break up follows a trend among large multinational companies that have chosen to split into smaller entities to increase flexibility and agility. Breen stated that the three smaller companies resulting from the spin-off will provide greater flexibility for pursuing focused growth strategies, including potential mergers and acquisitions. The intention behind the breakup is to create incremental value for shareholders, customers, and employees while allowing each company to operate with more independence and autonomy.
The move to split into multiple companies reflects a larger trend in the corporate world, with other major American companies such as J&J, Kellogg, and General Electric also opting for break-ups and spin-offs in recent years. This preference for smaller, more nimble organizations represents a shift away from the conglomerate structure that was prevalent in previous decades. DuPont’s decision to divide into three separate entities marks its second breakup in the last five years, as the company previously split from DowDuPont in 2019 to form DuPont, Dow Chemical, and Corteva, its agriculture business.
DuPont’s newly formed electronics company will focus on semiconductor solutions and advanced electronics products, while the water company will specialize in providing comprehensive water solutions. The remaining divisions will continue to operate under the DuPont umbrella. The company anticipates that the spin-offs will unlock additional value for shareholders and customers while creating new opportunities for employees. By allowing each company to pursue its own growth strategies independently, DuPont believes that it can position itself more effectively in the market and drive future success in the industry.
