- Edward Breen also replaces retiring Ellen Kullman as chairman
- `Deep dive' into cost structure, capital allocation on agenda
Edward Breen, the man taking over the helm at DuPont Co., is best known for helping Tyco International Plc recover from scandal and then breaking it up.
Breen was named interim chairman and chief executive officer of DuPont eight months after becoming a director during the first round of a clash with Trian Fund Management LP over splitting the company. Round two may have started Monday as Trian, the fifth-biggest DuPont shareholder, said it increased its stake in the company and suggested the campaign for a breakup might be revived.
Breen, 59, is replacing Ellen Kullman as CEO and chairman effective Oct. 16. He was at the helm of Tyco for 10 years starting in 2002, eventually selling off pieces of the company that L. Dennis Kozlowski spent a decade building. Kullman, a native of Wilmington, Delaware, DuPont’s hometown, will retire, the company said Monday in a statement. The shares climbed after the announcement.
“Breen is highly qualified,” Jim Sheehan, an Atlanta-based analyst at Suntrust Robinson Humphrey, said in a telephone interview. “He’ll be well received by investors, at least for the interim period, and he was supported by Trian” for the board appointment, he said.
The chemical maker would be worth more after a breakup because the resulting smaller entities would have greater “focus” and “accountability” and better operating results, Ed Garden, Trian’s co-founder and chief investment office, said Monday in a CNBC interview before Breen’s appointment.
Breen succeeded Kozlowski, who was convicted of looting millions of dollars from his company. In September 2011, Breen announced plans to splint Tyco into three units. That marked the second breakup in four years. In September 2012, he left Tyco, which sells fire-detection and security systems.
“We plan to conduct a deep dive into the details of our cost structure and the allocation of capital to ensure we deliver appropriate returns to our shareholders,” Breen said Monday on a conference call after the DuPont announcement.
In May, Trian disclosed that it spoke with Breen “in early 2014” about hiring him as an adviser. No agreement was reached. The fund manager approved of his appointment as an independent director at DuPont.
DuPont on Monday cut its forecast for full-year profit, citing weaker agriculture markets in Brazil and the dollar’s strength against the real. The company said that it hired a recruitment firm to find a full-time replacement for Kullman.
The shares rose 11 percent to $56.91 at 9:37 a.m. in New York Tuesday after earlier posting their biggest intraday gain in almost seven years. The stock is still down 19 percent for the year.