DuPont To Spin Off Performance Chemicals Segment; Stock Up 3%

(RTTNews) - Science and technology based company DuPont (DD) said Thursday its board has authorized it to execute a full separation of its Performance Chemicals segment as part of efforts to place it on a higher growth trajectory.

"Following a thorough strategic review process over the last year, the spin-off of Performance Chemicals is clearly the best option to deliver enhanced value for our shareholders," said CEO DuPont Ellen Kullman.

"Performance Chemicals will emerge as a top global industrial chemicals company with industry leading products and strong cash flow."

DuPont said it plans to execute the separation through a tax-free spin-off to shareholders, subject to customary closing conditions. Upon completion of the separation in about 18 months, 100 percent of the new public entity will be owned by DuPont shareholders.

DuPont's Performance Chemicals segment will operate as an independent, publicly traded company after the spin off. The new company will have businesses in Titanium Technologies and Chemicals & Fluoroproducts, with strong fundamentals and cash flow, along with entrenched positions in key markets. The Performance Chemicals segment generated revenue of about $7 billion in 2012.

In July, DuPont said it would explore strategic alternatives for its Performance Chemicals businesses as part of an ongoing portfolio review to determine the optimal mix of businesses for maximizing shareholder value.

Evercore and Goldman Sachs are strategic advisors on the spin off.

DuPont stock closed Thursday at $61.38, up $1.16 or 1.93%, on a volume of 6.7 million shares on the NYSE. In after hours, the stock gained $1.86 or 3.03% at $$63.24.