Activist investor Nelson Peltz and his Trian Fund have threatened a proxy war, but the casualties may be those employed and Dupont and its retirees, as reported by Delaware online.
As Peltz, who owns $1.9 billion worth of the company, tries to muscle his wayCut onto Dupont’s board and strives to compel them to take three of his nominees, retirees worry that his cost cutting measures may take the same form they took at Heinz.
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When Trian placed its own nominee on the board, Heinz stopped giving health insurance for retirees and replaced it with a reimbursement account, and the amount was sharply reduced year after year.
Medicare, of course, covers many of these retirees, but the difference between a surgery covered only by Medicare and it in a combination with DuPont’s insurance could make the difference between a surgery that costs many thousands of dollars to a few hundred.
A Trian spokesperson has given assurance that these benefits are not on the chopping block; “Trian’s nominees will strive to help DuPont to always be in a position to honor its obligations to current and retired employees, ” as reported by Delaware Online.
However, the operative word is “strive” or merely appear to be appearance, and “be in a position to honor” not that it will. Given Trian’s past history with Heinz, there are no guarantees, especially considering the fact that there is nothing that legally prevents a company like Dupont from cutting health insurance unless a contract was signed beforehand.