In October of 2013 DuPont announced that they would be creating a new company for their chemical manufacturing division. The new company would be called the ‘Chemours Company.’ The name Chemours comes from a combination of the word Chemicals and of the small town in France called Nemours. (The DuPonts were from Nemours.) This new spin-off of DuPont will now handle all of it’s refrigerant manufacturing and distribution as well as it’s titanium technologies. I wrote an article on this change back in May as well and it can be found here.
Chemours will be a completely separate company from DuPont, so it is better to see not so much as a child company but as a completely unaffiliated company. The new company is expected to launch completely on July 1st and it is expected to be able to purchase stocks as early as June 19th, 2015.
Even though ‘Chemours’ is a new company it is already being valued at an estimated $5.9 billion dollars. (You can read more about the stock side of the switch by clicking here to go to a Forbes article.) On top of the $5.9 billion projection it is set to be one of the top manufacturers of refrigerants in the world. Chemours will be a very recognized brand name very soon.
Dirty Laundry
I’ve always been a fan of DuPont. They are the primary inventory of mainstream refrigerants, they have created numerous inventions and innovations that we use in today’s modern world, and they even had a major part in our World War 2 effort. Not to mention that they and HoneyWell have some of the most reputable products on the market today. You want quality? You buy DuPont, it’s just a given. Over the years they’ve earned that reputation.
With all that being said it’s time to take a look as to why DuPont is spinning their refrigerant division into a completely separate company. Conglomerates don’t do this without reason and upon doing some research I came across the following:
- DuPont has been split up by the government numerous times in it’s history. It seems that it gets to the point of a monopoly and then the government intervenes and splits them up. They were not there yet with refrigerants but it was only a matter of time. There only main competition was HoneyWell, MexiChem, and the cheap import Chinese refrigerants. I believe they did this split to shrink their company and to hopefully prevent any prying eyes from the government. After all they are going from a $36 billion dollar company to a $5.9 billion dollar company.
- They are using this as an excuse to ‘restructure’ their entire refrigerant manufacturing process and distribution. Restructure is code for lay offs and lost jobs. All over the place. Now DuPont/Chemours are not saying exactly how many people are being laid off but I have found quite a few articles from that are showing just some of the lay offs.
- Environmental responsibilities and liabilities. There is a group, Keep Your Promises DuPont, that is pushing for action against DuPont from the Securities and Exchange Commission. They are claiming that by DuPont splitting into this new Chemours company that they are absolving any and all environmental liability from DuPont over to this new, smaller, and weaker Chemours company. So, if something goes wrong, there is a big environmental issue, or anything else that could potentially go wrong DuPont is no longer liable for any wrong doing. It all goes to Chemours. You can read more about this by clicking on this article from Delaware Online.
Conclusion
As you can see not is all as it seems. Yes, we will still be getting the same quality product that DuPont has manufactured for years but it is also worth taking a look at the bigger picture and see exactly why DuPont is doing this transition. Around 10,000 people lost their jobs and they are potentially absolving themselves of any future environmental responsibility. But, on the other hand we are now looking at a company that is solely dedicated to chemical manufacturing and distribution. Time will only tell if this is good fro the consumer, or if it was good for DuPont.