DuPont to Spin Off Performance Chemicals Division
DuPont has announced that it will spin off its $7 billion Performance Chemicals division, including the titanium dioxide and the chemicals and fluoroproducts businesses, to shareholders over the next 18 months. No jobs are planned to be lost in the move. The separation, which follows a "thorough strategic review process over the last year," is "clearly the best option to deliver enhanced value to shareholders," CEO Ellen Kullman said.
Observers said the U.S. group was responding to pressure from Wall Street. It was not clear whether it planned to divest the business or who potential buyers might be. Huntsman recently said it would buy the Sachtleben TiO2 business put up for sale by Rockwood.
After the separation of the division, Kullman said DuPont will have the optimum portfolio, will benefit from more consistent earnings growth and lower volatility and will have world-leading businesses, solid fundamentals and well established positions in attractive markets.
The TiO2 market has been on a rollercoaster ride over the past several years, with prices falling more than rising but recently has been seen as well on the way to recovery. While some industry heavyweights a year ago had sounded the death knell for the white pigment, used among other things to color plastics, DuPont had insisted the softness was overstated. However, it repeatedly postponed start-up of a $500 million 200,000 t/y plant at Altamira, Mexico.
Shortly before announcing the spin-off plans, the group had said the business was improving. In the third quarter, volume sales increased by 25%. The fluoroproducts business, one of the traditional pillars of DuPont's portfolio, includes the well-known polytetrafluorethylene, the heat-resistant coating sold under the brand name Teflon.
