DuPont has named Edward D. Breen as its new chairman and CEO, removing the “interim” designation he held since shortly after Ellen Kullman’s sudden departure from the role a month ago.
Breen’s appointment comes at a critical time for the Wilmington, Del.-based firm. Under attack by activist investors, including Nelson Peltz and his Trian Fund, DuPont has been under pressure to make itself a simpler and more consistently profitable firm.
More recently, low crop prices, weak demand, and a strong dollar have hurt the agricultural chemicals business of DuPont and its competitors, leading to consolidation talk among the major players.
By naming Breen to the CEO spot, DuPont’s board strengthens Breen’s hand in talks he and others, such as Dow Chemical CEO Andrew N. Liveris, have acknowledged are under way over the possible divestiture or joint venturing of crop protection businesses. Press reports indicate that preliminary discussions are under way through which DuPont could buy Dow’s agricultural division or DuPont and Syngenta could work out a deal.
DuPont’s newest CEO brings a history as a decisive executive to the job. According to Alexander M. Cutler, DuPont’s lead director, Breen is “the right leader for the company.”
From 2002 to 2012 as CEO of the conglomerate Tyco International, Breen oversaw what DuPont describes as “a highly successful restructuring, including two breakups of the company resulting in the spin-offs of Covidien, Tyco Connectivity, and ADT Corp. and the merger of Tyco Flow Control with Pentair.” Breen continues as chairman of Tyco.
Breen has held other senior management positions, including president and chief operating officer of Motorola and president and CEO of General Instrument Corp.
Breen joined DuPont’s board in February as one of two new members intended to counter Trian’s efforts to place its own nominees on the board. The other board member DuPont named at that time was retired LyondellBasell Industries CEO James Gallogly.
UBS chemical stock analyst John Roberts agrees with other analysts that Breen’s permanent appointment augurs well for deals that simplify DuPont’s complex structure. But given the time it takes to do large deals, “you would think his first focus will be on reducing costs,” he says.