By Frank Esposito
SENIOR STAFF REPORTER
Published: September 18, 2014 7:37 pm ET
Updated: September 18, 2014 7:42 pm ET
Investment firm Trian Fund Management LP is calling for plastics and chemicals giant DuPont Co. to split itself into two firms, one of which would include most of the firm’s plastics units.
New York-based Trian — which holds $1.6 billion in DuPont stock, or roughly 3 percent of the company — “can no longer be silent as DuPont continues to struggle to execute what we are convinced is a flawed business plan,” fund officials said in a Sept. 17 letter to Wilmington, Del.-based DuPont.
They added that DuPont’s conglomerate structure “is destroying value” and prevents the firm from producing better financial results. The split would be in addition to DuPont’s previously announced plan to spin off its Performance Chemicals unit, including fluoropolymers and titanium oxide.
One of the two new companies proposed by Trian would include DuPont’s Performance Materials unit, which makes such resins as nylon, acetal, PBT, copolyester and ethylene copolymers, as well as polyester and nylon film.
DuPont officials responded that same day with a statement that said its board and management team “have taken firm action over several years that has delivered 220 percent total shareholder return since year-end 2008, compared to 144 percent for the S&P 500 during the same period.”
The company has done this, they added, “by aggressively deploying our leading science across the company, strengthening and fine-tuning our portfolio, and through disciplined capital allocation.”
“The board and management team remain committed to executing on our strategic plan to drive growth and profitability,” officials said. “The recently announced first phase of our redesign initiative to drive down costs by $1 billion and embed greater efficiencies, together with the separation of Performance Chemicals and our $5 billion share repurchase program, reflect our board and management’s commitment to enhance value for all DuPont shareholders.”
The Trian letter gave a jolt to DuPont’s per-share stock price. It closed just under $66 on Sept. 16 — the day before the letter — but was at $71.20 in late trading Sept. 18, for an increase of almost 8 percent.
DuPont’s total sales were flat at about $20.3 billion in the first half of 2014, but the firm’s profit fell more than 40 percent to $2.5 billion. First-half Performance Materials sales also were flat at just over $3.1 billion, but the unit’s operating income increased almost 55 percent to $958 million in the same comparison. | 
