Published On: Wed, Feb 18th, 2015

DuPont Strikes Back Against Nelson Peltz’s Proxy War Threats

DuPont CEO Ellen Kullman says DuPont's success has nothing to do with Trian's stake

Nelson Peltz

DuPont CEO Ellen Kullman is not taking Nelson Peltz’s proxy fight threats lying down.

Kullman issued a letter to shareholders to dispel the “Trian myths” and misinformation the activist investor was spreading about the company. Peltz demands that he and three others be voted to DuPont, that it split itself up even further following its planned spin off of the performance chemicals business. If not, Peltz has threatened a proxy fight, according to Reuters.

Kullman has rejected Trian’s demands and appointed its own nominees to the board. She added that management has met with Trian over 20 times to try to “work constructively” with the fund. DuPont’s stock has risen 18% since last year, but Trian has taken credit for the uptick in the stock price, given its activist involvement.

However, in the letter to shareholders, Kullman demonstrates that the increases have been consistent with its performance for seven years, long before Trian bought a stake in 2013. DuPont also said that it planned to spin off its performance chemical business long before Peltz got involved with the company.

While Peltz has taken an activist role before, this is just another case in a general trend of fund managers becoming increasingly aggressive in trying to change a company’s management and strategy. Following Bill Ackman’s high profile fights with Allergan and Herbalife, his copious returns in 2014 have led other managers to copy his strategy.


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