E.I. du Pont de Nemours and Company DD
DuPont is bottom-quartile under Ellen Kullman; electing Trian's four nominees unlocks $120/share by 2017 by cutting $2-4bn of excess corporate costs and ending 'crony' compensation.
Thesis
Trian Partners argues that DuPont — a seven-segment chemicals/agriculture conglomerate run by CEO Ellen Kullman since 2009 — has been bottom-quartile on EPS growth since 2011 (-7% vs ~30% peer median), with EBITDA margins lagging peers in 5 of 7 segments and ROIC 40% below cost of capital across two-thirds of the revenue base. The Coatings/Axalta case study, where private-equity owners grew EBITDA 150% after DuPont sold the unit for cash, exposes $2-4bn of excess corporate costs burdening the remaining businesses. Compounding this: a board that paid management 80-100% on 'individual performance' the same year it assigned a 0% 'corporate performance' score, and a Chemours spin loaded with anti-takeover entrenchment. Trian asks shareholders to vote the GOLD proxy card to elect Peltz, Myers, Winkleblack and Zatta, implying $120/share by 2017 (21% IRR).
SCQA
DuPont is a $60bn seven-segment chemicals and agriculture conglomerate with 70,000 employees, led by CEO Ellen Kullman since 2009 and reliant on long-term targets of 7% revenue and 12% EPS growth.
Performance is bottom-quartile across every peer group: EPS down 7% since 2011, margins lag peers in 5 of 7 segments, ROIC 40% below WACC ex-Ag, and an estimated $2-4bn of excess corporate costs burden the businesses.
Elect Trian's four highly qualified nominees — Nelson Peltz, John Myers, Arthur Winkleblack and Robert Zatta — to bring an ownership mentality, eliminate excess costs, end 'crony' compensation, and assess portfolio structure objectively.
Trian's Summary White Paper implies a target value in excess of $120 per share by year-end 2017 — a 21% IRR — with additional upside if the $2-4bn of excess corporate costs is eliminated.
The three reasons
- 1
DuPont's EPS growth has been bottom-quartile vs every peer group (-7% 2011-14 vs ~30% peer median)
- 2
Coatings/Axalta proves $2-4bn of excess corporate costs — same business, +68% EBITDA under PE owners
- 3
Board rewards management for missing targets: 0% corporate-performance score, but 80-100% individual-performance payouts
Primary demands
- Elect Trian's four nominees (Peltz, Myers, Winkleblack, Zatta) to the DuPont board
- Eliminate $2-4bn of excess corporate costs burdening every segment
- Assess corporate structure / separate the portfolio if management cannot deliver peer-level margins
- End 'crony' compensation — align pay with operating performance
- Improve governance, including at the Chemours spin-off (remove staggered board, supermajority provisions)
KPIs cited
Pattern membership
Where this document fits across the library's 12 rhetorical / structural patterns.
Precedents cited
- Heinz (Peltz/Winkleblack 2006-2013, sold to 3G/Berkshire at 20% premium)
- Rockwood (Zatta/Ghasemi — 364% TSR, 48% multiple re-rating via separation)
- Snapple/Triarc turnaround (Peltz, HBS case study)
- Coatings → Axalta (DuPont sold for cash; EBITDA +150% under PE)
- Family Dollar (Trian defended board, ultimately sold to Dollar Tree)
- BNY Mellon (Trian backed management vs dissident)
- Ingersoll-Rand / Allegion spinoff
- Mondelez / Kraft separation
- Recent shareholder-friendly spinoffs: Time Inc., PayPal, Gannett
Notable slides (6)
Notes
April 21, 2015 proxy-fight 'Discussion Points' deck — every page footer carries the 'VOTE THE GOLD PROXY CARD' badge. Closing branded slide is page 40 ('DuPont Can Be Great'); the deck then continues 41-87 with appendices (director credentials, stock-price attribution, third-party perspectives, excess-cost methodology). Stake of 2.7% inferred from Appendix C activity table (page 39, 'Highest % of Total Company Owned by Trian'); not stated as a current SEC-filed beneficial ownership %. Outcome (filled later): Trian narrowly lost the May 2015 proxy vote but Kullman resigned in October 2015 and DowDuPont merger followed in 2017 — campaign widely seen as a partial/delayed win. Notable rhetorical devices: 'Rhetoric vs Reality' two-column page (31), 'Saga of DuPont's 2011 EPS' showing 9 different figures (33), and the 0% vs 80-100% bonus juxtaposition (26).