By Jacob Bunge
DuPont Co. struck back at Trian Fund Management LP in a letter
to shareholders that accuses the activist investment firm of using
misleading information and other unfair tactics to gain seats on
its board.
The letter, which DuPont published Tuesday, says Trian is
wrongly claiming credit for the chemical company's strategic moves,
and questions the investment firm's track record in the chemical
business.
DuPont's letter, accompanied by a presentation taking aim at
what the company called "myths" promoted by Trian, marked the
212-year-old company's strongest salvo yet in its escalating battle
with the fund, which last month nominated Trian co-founder Nelson
Peltz and three other candidates to DuPont's board.
"Trian has launched a proxy fight based on misrepresentations,
inaccurate data, and flawed analyses to distract from DuPont's
track record of strong performance," Ellen Kullman, DuPont's
chairman and chief executive, wrote in the letter.
A Trian spokeswoman had no immediate comment.
Trian in a presentation last week claimed credit for driving
changes in DuPont's business and an overall rise in its share price
over the past two years, saying that the firm's presence "has
already made a positive impact" at DuPont.
Trian pointed to DuPont's plans to spin off its performance
chemicals division into a company to be called The Chemours Co., a
cost-cutting plan that aims to strip out $1 billion in costs by the
end of 2015 and a $5 billion share repurchase plan as examples of
DuPont actions since Trian made its initial investment, which has
grown to about 2.7% of DuPont's shares.
DuPont's letter rejected those claims. "[I]n fact, we had
initiated planning for the Chemours spin-off well before Trian's
investment," Ms. Kullman wrote.
DuPont also criticized Trian for "backtracking" from earlier
calls to split the rest of DuPont after the Chemours spinoff into
two companies, one focused on agriculture and nutrition products,
the other on industrial materials. DuPont said its board rejected
the "high risk" plan because it wouldn't pay off for shareholders.
Trian has said its nominees would be open to other plans if they
were elected to the board.
Ms. Kullman's letter took aim at what it called Trian's "only
investment" in the chemicals sector, a stake in specialty chemical
maker Chemtura Corp., which placed Trian co-founder and chief
investment officer Ed Garden on its board and in 2009 filed for
bankruptcy.
Trian's "board leadership and strategic plan resulted in
Chemtura filing for bankruptcy," Ms. Kullman wrote.
DuPont shares were 5 cents lower at $76.13 in early trading
Tuesday, in line with major stock-market indexes.
David Benoit contributed to this article.
Write to Jacob Bunge at jacob.bunge@wsj.com
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