DuPont announced a definitive agreement to sell an 80.1% ownership interest in the Delrin business to TJC LP (TJC).
TJC has received fully committed financing in connection with the transaction, which is expected to close around the end of this year.
At close, DuPont will receive pre-tax cash proceeds of approximately $1.25 billion, subject to customary transaction adjustments, a note receivable of $350 million, and will own a 19.9% non-controlling common equity interest in the Delrin business.
Delrin came out of DuPont’s labs in the 1950s as a plastic that could be used as a substitute for metal gears and other components. The earliest research came from a German scientist who won the Nobel Prize in the early 1950s. More recently, Delrin has been used in 3D printing of parts and other items.
Under CEO Edward Breen, DuPont has been selling off legacy and other businesses in an effort to make the company more appealng to investors and hold up its stock price.
Earlier, DuPont also spun off a large food and other ingredients business to IFF, with DuPont shareholders retaining a 54% stake in the New Jersey company.
“Today’s announcement largely completes our planned exit of the former M&M segment, advancing our position as a premier multi-industrial company,” said Ed Breen, DuPont CEO. “This transaction is structured to maximize value for our shareholders, providing significant cash proceeds at close to be deployed in line with our strategic priorities while providing an opportunity for DuPont to participate in future upside potential upon exit of our retained equity interest in the Delrin business.”
“We are excited to partner with TJC given their successful track record of creating value through an operations-focused approach and are confident in their ability to drive growth and opportunity for employees and customers of the Delrin business,” Breen added.
“Delrin is widely recognized as the material of choice for safety critical and high cost-of-failure applications across diverse end markets,” said Ian Arons, TJC Partner. “For over 60 years, the Delrin business has leveraged its differentiated technologies and global manufacturing presence to provide its customers high quality, innovative solutions. We are thrilled to have DuPont as a partner, and we look forward to working closely with the entire Delrin team to drive future growth in the business.”
TJC (formerly known as The Jordan Company), founded in 1982, is a middle-market private equity firm that has raised funds with original capital commitments in excess of $22 billion. Its investments inlcude packaging companies and the Bojangles chicken and biscuit chain. Further information is available at www.tjclp.com.
