In August 2016, DuPont and Dow Chemical consummated a merger of equals transaction, whereby the two entities combined into a holding company named DowDuPont. The various businesses and segments within DuPont and Dow Chemical merged into three new divisions (Agriculture, Material Science, and Specialty Products), each of which is anticipated to spin-off into an independent, publicly traded company by the end of 2018.

The spin off occurred in 2019, with DuPont taking specialty products, Dow getting materials and chemicals, and Covetra, a new entity, getting agricultural products. Each company on its own should have enough revenue to make the FORTUNE 500.

Operations

The DuPont and Dow merger is having a profound influence over organizational structure and line-of-business definition within the traditional DuPont segments. DuPont’s six segments and 10 business lines are being merged with Dow counterparts in the DowDuPont holding company to define three post-merger operating divisions: Agriculture, Material Science, and Specialty Products.

Prior to the merger, DuPont’s six reportable segments were Agriculture, Electronics & Communications, Industrial Biosciences, Nutrition & Health, Performance Materials, and Safety & Protection.

The largest segment, Agriculture, generates about 40% of sales and consists of the Pioneer Hi-Bred International and DuPont Crop Protection businesses, which together offer a bevy of products and services aimed at improving crop yields. Products include Pioneer brand seeds, as well as other insecticide, fungicide, and herbicide brands. It will land in the post-merger Agriculture division.

The Performance Materials segment (some 20% of sales) includes Performance Polymers and Packaging & Industrial Polymers and provides its customers with innovative polymer science solutions and expert application development assistance. It will be placed into the post-merger Material Science division.

The Safety & Protection businesses (about 15% of sales) include Protection Technologies, Building Innovations, and Sustainable Solutions. It will reside in the post-merger Specialty Products division.

Nutrition & Health offers a wide range of sustainable bio-based ingredients for specialty food ingredients, food nutrition, health and safety products. It will become part of the post-merger Specialty Products division.

Electronics & Communications is a supplier of differentiated materials and systems for photovoltaics, consumer electronics, displays and advanced printing. It will be placed into the post-merger Specialty Products division.

Industrial Biosciences develops and manufactures a broad portfolio of bio-based products. The segment's enzymes add value and functionality to processes and products across a broad range of markets such as animal nutrition, detergents, food manufacturing, ethanol production and industrial applications. It will reside into the post-merger Specialty Products division.

In mid-2015 the company spun off its Performance Chemicals business into the Chemours Company.

Geographic Reach

DuPont has operations in more than 90 countries worldwide. The majority are located in Europe, while other operations can be found in North America, Latin America, the Middle East, Africa, and Asia/Pacific.

About 40% of company revenue (roughly $10 billion) comes from the US, with a bit more than 20% of sales generated in each of EMEA and Asia Pacific. Latin American and Canadian customers contribute the remaining revenue.

Sales and Marketing

DuPont serves a range of industries including Agriculture, Automotive, Building and Construction, Chemicals, Electronics, Energy, Food and Beverage, Government and Public Sector, Health Care and Medical, Marine, Packaging and Printing, Plastics, and Safety and Protection.

In its agriculture business DuPont markets and sells seed products under the Pioneer brand and additional brand names. They are sold in the US via a specialized force of independent sales representatives and are sold outside the US through a network of subsidiaries, joint ventures, and independent producer-distributors. DuPont Crop Protection products are marketed and sold to growers and other end users through a network of wholesale distributors and crop input retailers.

Financial Performance

Note: Financials for Dow will be updated when it files a Form 10-k as an independent company.

In fiscal 2016, DuPont's net sales decreased by 2% (to $24.6 billion) compared to fiscal 2015 reflecting a 1 percent decline from the negative impact of weaker currencies and a 1 percent decline due to lower prices and product mix.

Net income increased by 29% (to $2.51 billion) due to lower expenses for R&D and SG&A. The results were also boosted by a decrease in pension and other post-employment benefits costs following a 10% reduction in its worldwide workforce.

Cash on hand at the end of 2016 was $4.6 billion, down nearly $700 million from the prior year. The decrease was caused by a $2.3 billion use for financing activities (stockholder dividends & payments against long-term debt), a $1.5 billion use for investing activities, and $3.3 billion of cash generated by operating activities.

Strategy

The immediate strategic goal is the integration of its businesses, processes, and employees with its Dow Chemical counterparts. The timeline for this endeavor is expected to be 18 to 24 months, ending around late 2018.

DuPont's general strategy for growth is to use its expertise in science and technology to launch products that address global needs for protection wear, electronics, industrial science products, nutrition, and agricultural production, among others.

Mergers and Acquisitions

In order to gain approval for the Dow Chemical deal from European regulators, DuPont traded businesses with FMC. DuPont sold part of its crop protection business to FMC and FMC sold its health and nutrition business to DuPont. DuPont gained about $1.6 billion on the deal due to differences in the valuations of the assets. FMC's Health & Nutrition business generated more than $700 million in revenue in 2016 from food ingredients and pharmaceuticals. DuPont expects that the additional products will complement its nutrition and health business.