A letter that E I Du Pont De Nemours And Co (NYSE:DD) wrote to Nelson Peltz clarified that the firm was not interested in carrying forward Trian Fund Management LP’s proposal. As per the reports, renowned hedge fund proposed two nominees; one to the board of a unit that it wants to spin-off and one to the board of company’s chemical conglomerate.
Insights On That Matter:
As soon as this news hit the market, a lot of adverse changes in company’s stock were seen; hence, DuPont decided to put forth its stand on this matter. As per the reports, the company stated that it was prepared to appoint one of the two nominees named John Myers who was suggested by Peltz. It added that it didn’t want to take this proxy war with Train to a new level. Soon after DuPont’s statement Peltz told CNBC that appointing one of the nominees to company’s board was not enough.
Reports claim that Peltz is not happy with the company’s decision as he wants to see himself and one of his fund’s nominees on the board of DuPont. Apart from this, he also wants two of the nominees suggested by him on the board of Chemours, which is DuPont’s performance chemicals business unit. The company wants to spin off this unit in the second half of 2015 due to obvious reasons. A statement of DuPont stated that Trian principal’s direct representation could never result in a mutually acceptable resolution in any condition. The statement came right after Peltz and Ellen Kullman, Chief Executive Officer, DuPont had words on the phone.
Train owns 2.7% of DuPont’s shares and has been forcing it for a long time to spin-off its materials business, which has not performed consistently in the recent past. DuPont has repetitively turned down this proposal many a times in the past.