Seaford plant is part of DuPont subsidiary
By Bryant L. Richardson
On Monday DuPont announced the alignment of its businesses in five market-and technology-focused growth platforms and the creation of a Textiles and Interiors subsidiary. The DuPont Plant in Seaford is part of the new subsidiary.
The longterm effect on the Seaford DuPont Plant is still open for discussion. Seaford DuPont Plant spokesman Gary Knight said all the information about the change is coming out of Wilmington, DuPont’s headquarters.
According to DuPont the future of the company will be concentrated on five growth platforms. They are:
- DuPont Electronic & Communication Technologies
- DuPont Performance Materials
- DuPont Coatings & Color Technologies
- DuPont Safety & Protection
- DuPont Agriculture & Nutrition
The glaring omission from DuPont’s future strategy, as far as Seaford area residents are concerned, is the textile division. This will become part of the new subsidiary.
“The new wholly owned subsidiary, called DuPont Textiles & Interiors, will include the nylon fibers, polyester fibers and Lycra® brand fiber businesses, plus their intermediates and joint ventures,” the company stated.
DuPont said it will consider a full range of options for DuPont Textiles & Interiors, including an Initial Public Offering (IPO), with the ultimate intent of separation by yearend 2003, market conditions permitting. The company has engaged Morgan Stanley to assist in the evaluation process.
“A company can operate successfully for 200 years only by continually reinventing itself,” DuPont Chairman and CEO Charles O. Holliday, Jr. said.
“DuPont people in all of our businesses know this is key to a strong future. Each of the five growth platforms has the critical mass to pursue our strategies of integrated science, knowledge intensity and productivity improvement while capitalizing on strong market positions, quality products and powerful brands. At the same time, our new Textiles & Interiors subsidiary will have the scale, global reach and flexibility to be highly successful in an industry undergoing fundamental structural change.”
He said DuPont Textiles & Interiors will be the world’s largest integrated fibers company with annual segment sales estimated at $6.5 billion.
“This represents about 23 percent of 2001 total DuPont Company segment sales, which includes transfers and the company’s pro rata share of sales by equity affiliates,” the company said. “The subsidiary will be structured to grow shareholder value by aligning resources with market opportunity and establishing an industry-competitive cost structure.
“As the global leader in product categories representing 75 percent of its revenue, DuPont Textiles & Interiors will have significant cash and earnings growth potential based on growth in key branded platforms such as Lycra® brand fiber, Stainmaster® carpet and Antron® nylon carpet, significant cost reduction opportunities, a robust innovation pipeline and strong market channel access.”
DuPont Textiles & Interiors will be led by DuPont Executive Vice President and Chief Operating Officer Richard R. Goodmanson and an experienced team including Group Vice Presidents Steven R. McCracken and George F. MacCormack.
“Our nylon, polyester and Lycra® businesses have played a very important role in DuPont for many decades,” Holliday said.
“They have served our company, our shareholders and our customers extremely well. Now, with rapidly changing industry dynamics and tough market realities, we believe the course we have chosen is necessary to allow them to succeed in the future.”
Concurrent with these actions, DuPont will offset all residual costs from the separation of the DuPont Textiles & Interiors subsidiary by aggressively reducing its cost structure for corporate and support services. This effort will be led by W. Donald Johnson, Group Vice President - Operations & Services.
The five growth platform leaders will report to John C. Hodgson, currently Group Vice President, who is appointed Executive Vice President. DuPont external financial reporting will be realigned to reflect the new management structure.
“Consistent with our long-term strategy and direction, our growth platforms will be more tightly focused on markets and technologies. This will enable faster execution and improved capability for innovation and shareholder value creation,” Holliday said.
The new subsidiary employs 22,000 and has annual sales of $6.5 billion. Seaford is one of 300 plants in the subsidiary worldwide. Its exact role in the new organizational structure will not be known for some time.
Optimism among those affected is high that this new venture will be successful. The textile business is highly competitive, but the subsidiary will be the largest in the world.
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