DuPont Replaces CEO Amid Struggle to Expand Sales -- 2nd Update

By Austen Hufford 

DuPont de Nemours Inc. said Tuesday that it is bringing back as its chief executive Edward D. Breen, an architect of the megamerger and spinoff from Dow Inc. that left a smaller industrial-materials maker struggling to generate sales growth.

DuPont said its board had decided to remove Chief Executive Marc Doyle and Chief Financial Officer Jeanmarie Desmond less than a year after they assumed those roles. Mr. Breen, the company's executive chairman, was named CEO, and Lori D. Koch, previously head of investor relations, became financial chief.

For Mr. Breen, the return to the helm at DuPont is an attempt to fix what appears to be the most troubled of the three companies spun out of a merger that defined his career.

"We did not meet our own expectations," Mr. Breen said in a written statement. "We need to accelerate operational improvement."

Dow Chemical Co. and DuPont Co. agreed to a $120 billion merger in late 2015, setting plans to combine and then split into three separate companies. In addition to DuPont, the materials-science business is now called Dow Inc. and the agriculture business is known as Corteva Inc.

Before joining DuPont in 2015, Mr. Breen spent a decade at the top of Tyco International PLC, where he broke apart what was once one of the largest U.S. conglomerates.

When Mr. Breen came to DuPont, it was under pressure from Nelson Peltz's Trian Fund Management LP to break up. Mr. Breen brought Trian into deal talks with Dow to ensure the activist fund approved of the merger.

DuPont's shares have underperformed the other two companies spun out of the merger since June 2019, when the last of those, Corteva, began trading publicly. DuPont's shares, which rose 0.6% on Tuesday, are off about 30% over that time. Dow is off 0.2% since June 2019, while Corteva is up 27%.

DuPont, whose array of products includes fibers for bulletproof vests and wraps for homes under construction, said last month that sales fell 5% in 2019. The company said it expects demand to remain weak this year for materials including nylon, one of its main products.

DuPont's missteps come during a broader slowdown in U.S. manufacturing and global trade. Other major manufacturing companies, including 3M Co. and Caterpillar Inc., have reported slowdowns in key markets in the U.S. and abroad.

DuPont said in December that it would spin off its nutrition business and combine it with International Flavors & Fragrances Inc. to make a top supplier of ingredients to food makers.

Write to Austen Hufford at [e-mail]

(END) Dow Jones Newswires

February 18, 2020 17:03 ET (22:03 GMT)

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