Soon there will be two: DowDuPont chief executive and corporate spin-off artist Edward D. Breen named top leaders Monday for two big, Delaware-based manufacturing companies that will be carved out from the merged chemical conglomerate next spring.
The spin-offs are Corteva Agriscience, combining the two companies' global farm-crop seeds and pesticides businesses, and a new, reshaped version of the old DuPont Co. The new DuPont will include four business groups: electronics and imaging; safety and construction; transportation and advanced polymers; and nutrition and biosciences. The groups are based on DuPont businesses plus Dow units from similar industries.
The two new companies, with yearly sales above $20 billion each — compared with around $32 billion for DuPont before its 2016 Dow merger — will each open headquarters in Wilmington next spring after separating from the temporary conglomerate that Breen heads. A third spin-off, a reconstituted Dow Chemical Co., will be based in Michigan, separating by April 30. Breen had committed to cutting more than $3 billion in facility closures, layoffs, R&D lab consolidation, and other expense cuts to make the spin-offs more profitable for investors. DowDuPont also updated its DuPont Experimental Station labs near Wilmington, and other key facilities.
Breen isn't going away once DowDuPont is chopped apart. The New Hope resident, a onetime General Instruments Corp. cable salesman who oversaw a similar series of spin-offs and breakups at the former Tyco International Inc., will be staying on as "executive chairman" of the new DuPont, in charge of strategy for the company and its business groups, each with at least $5 billion in yearly sales. Those businesses could also get sold in the future.
DuPont and Corteva officials haven't yet made clear whether they will move or add offices outside the DuPont complex, on Centre Road (Delaware 141) west of Wilmington. DowDuPont agreed to base the two companies in Delaware after the state agreed to $34 million in yearly tax breaks. The companies will divide pension and environmental cleanup obligations. Former DuPont lobbyist Lawrence Craig Skaggs and other activists have mobilized retirees to pressure the company to continue its pensions instead of converting payments to insurance annuities as some large companies have done.
At DuPont, Breen's top lieutenants will include chief executive Marc Doyle, a veteran chemical engineer who has risen through the ranks. In a statement, Breen said Doyle "delivered on all key financial metrics" while overseeing merger-related cuts and faster product development "with a rigorous focus on shareholder returns." Jeanmarie Desmond, who served as co-controller of the combined company, will be executive vice president and chief financial officer. Erik Hoover, who had served as DuPont's chief compliance officer, will be senior vice president and general counsel.
Doyle will focus on "business execution, growth initiatives," and "a culture of innovation and operational discipline in order to maximize shareholder value," the company said. He will report to Breen, who "will work closely with the senior leadership team and focus on the company's portfolio management strategy [and] capital allocation decisions."
Breen and Doyle will share shareholder responsibilities, which became a matter of CEO career life and death at predecessor companies Dow and DuPont in 2015: Both companies were pressured into the merger by hedge fund managers disappointed by years of poor investment returns.
The second company, Corteva Agriscience, combining the genetically-modified seed and pesticide businesses of Dow and DuPont — including their labs and factories in the Midwest, Europe, Asia, and Latin America — will also be based in Wilmington. As expected, Breen named James C. Collins Jr., a 34-year DuPont veteran who had been executive vice president in charge of DuPont's ag businesses, as chief executive officer for the independent company. Collins took on added responsibilities after the DuPont merger, as other DuPont veterans left. Collins will take over Corteva with his current deputies Greg Friedman, as executive vice president and chief financial officer, and Cornel Fuerer, as senior vice president and general counsel.
DowDuPont earlier this year named Jim Fitterling as CEO, Howard Ungerleider as president and chief financial officer, and Amy Wilson as general counsel of the successor Dow Chemical Co. The new Dow will include DuPont's ethylene copolymers group of seals and resins.
Directors for all three successors will be named by Halloween, DowDuPont said.
Over the past 2½ years, Breen worked closely with the newly-named executives, demanding long hours and fast decisions about the fate of business lines, labs, and facilities. They will be rewarded, if all goes on plan, with significant share grants that could make them wealthy.
In a statement, Breen praised the two CEOs as "unparalleled" experts in their field, and added that both teams' leaders "have successfully delivered growth, driven integration initiatives, and captured synergies, while also taking the steps needed to build world-class organizations that will position the independent companies to win in the marketplace." Breen said he's confident they will "create value" for "shareholders, customers, employees," and DuPont's business partners.
Breen is also a director of Philadelphia-based Comcast Corp., has financed hotels in Bucks County and at the Shore, and serves as an adviser of private-equity firm New Mountain Capital LLC.