Trian Partners Activist Presentation Deck
DuPont: New Management and Separation Plans Led to Better Operating UPOND
Performance (Growth/Margins)
Poor results under former management:
Despite owning iconic industrial businesses and leading market share positions, DuPont
underperformed peers and struggled to meet earnings promises
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On 3/15/13, the day before Trian first invested in DuPont, the stock price was ~40% below its
prior high from 15 years earlier(1)
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New management led to better operating performance (growth and margin):
In 2015, after the company missed earnings targets for a fourth consecutive year, DuPont
replaced the CEO/Chair with Ed Breen
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DowDuPont's Plans to Separate (M&A):
In November 2015, Trian signed confidentiality agreements with both DuPont and Dow after
being asked to assist in the negotiation and structuring of a $130bn merge-and-spin transaction
(completed in 2017 after regulatory review)
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Once DuPont replaced management and started to execute on Trian's operating initiatives,
including eliminating the matrix structure, standalone DuPont improved organic growth by
~400bps(²) and eliminated ~$1.7bn of costs pre-merger(³)
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DowDuPont currently plans to separate into three more focused, world-class companies in
Agriculture, Specialty Products and Materials Science
$4.3bn of planned synergies to the benefit all shareholders, over and above the standalone
improvements pre-merger
Sources: Bloomberg, DuPont press releases and transcripts, DuPont SEC filings.
Note: This case study is an example of a discrete investment, which is presented solely to illustrate the benefits of certain operational improvements and Trian's investment process and strategies and not to imply that any future investment by
Trian will be successful. Market conditions at the times of the events reflected in this case study may differ materially from current and future market conditions.
(1) On 5/22/1998, DuPont's share price was $78.31. On 3/15/13, the day before Trian first invested, the share price was $47.40 (pre-merger with Dow).
(2)
(3)
Average year-over-year volume growth improvement from Q1 2016 to Q2 2017.
$1.7bn in cost savings initiatives represents the $1bn of run-rate cost savings realized before 2015 plus the additional $700mm of realized in 2016 (press release exhibit to DuPont's Form 8-K filed on December 11, 2015).
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