DuPont wins proxy fight against Peltz’s Trian Fund

DuPont shareholders on Wednesday flatly rejected a contentious campaign by one of the most powerful investor firms in the U.S. for seats on the board of the 212-year-old chemical company.

Nelson Peltz and his Trian Fund Management, a major shareholder, had sought more influence at DuPont, saying that the company was falling short of its potential. Chief Executive Ellen Kullman has resisted Peltz’s campaign vigorously, saying that he was mischaracterizing DuPont’s performance.

Kullman said the proxy fight showed that DuPont needs to do a better job explaining its ongoing transformation from a traditional chemical company to a growth company focused on developing advanced materials, bio-based industrial products, and new seed, food and agricultural products to improve the global food supply.

“I think we as a company don’t tell our story well enough,” she said. “We’ve undergone a lot of change, and as we’ve engaged with shareholders, even retail, it was clear that they remembered a company of maybe 20 years ago, not the company that we’re creating going forward.”


As an example, Kullman pointed to the upcoming spinoff of DuPont’s performance chemicals unit into a separate commodity chemicals company called Chemours. She said Peltz’s fight for board seats forced the company to move up its public relations campaign about the spinoff.

Peltz’s Trian Fund Management owns about 24.6 million DuPont shares, making it the company’s fifth-largest shareholder. Since first buying huge stakes in the company almost two years ago, he has criticized DuPont for missing its earnings targets and failing to meet its goals, laid out in 2011, of a 12% compound growth rate in operating earnings per share, and a 7% compound annual growth rate in sales.

Trian had nominated four directors for DuPont’s board but came up empty.

“I think we lost because they probably did a better job with the press. … I think they clearly did a better job with the retail shareholder who really doesn’t understand the issues of the company,” said Peltz, who claimed “overwhelming support” from institutional investors and mutual funds.


“I think there was a lot of scare tactics employed,” he said, rejecting DuPont’s assertions that he wanted to overleverage the company and slash funding for research and development.

Peltz also took credit for several actions taken by DuPont since Trian took a stake in the company, including a $5-billion share buyback program, new cost cuts, the placement of two new directors on the board and the spinoff of Chemours.

“All of that stuff didn’t happen by accident,” he said, adding that Trian will continue to monitor DuPont.

Shares of Dupont fell $5.03, or 6.8% to $69.33.

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