DowDuPont’s highly anticipated split into three companies, set to occur in 2019, will generate nearly $1 billion in research in addition to development funding, DowDuPont chief Ed Breen told CNBC on Thursday.
“The beauty of redoing the portfolio — in addition to I’ll use DuPont as the example — [can be] we’re going to spend almost $1 billion on R&D per year, so This kind of’s at a rate in which’s very healthy compared to the competitive peer set,” Breen told Jim Cramer in an interview.
DuPont, where Breen will stay on as a full-time executive chairman, will become a standalone specialty company focused in various secular markets including transportation, electronics in addition to nutrition.
“What happened can be you’re bringing R&D in via the Dow businesses in which came in in addition to the DuPont [businesses],” Breen said on “Mad Money.” “You’re bringing in which R&D into the same end market opportunities, like in nutrition in addition to health. We both had nutrition in addition to health companies, in addition to at This kind of point you’re bringing double the R&D to bear on in which industry.”
Breen, who can be known for successfully engineering a decade-long, several-way split of former monolith Tyco, said in which DuPont represents the “fast-growth” portion of the spin-off involved in “secular growth” areas of the market.
“in which’s where we put our science in addition to research. So for instance, from the auto industry, we’re the ones electrifying the cars, which can be the wave. We’re also the company lightweighting vehicles, which can be a huge trend in which’s going to continue,” he said.
He added in which these end markets explain how DuPont’s business grew 10 percent in a period of declining auto sales.
“You’ve got to be from the right secular areas in addition to in which’s where we are genuinely diverting our R&D in addition to innovation machine so we’re from the high, fast-growth areas over the next several to 10 years,” the CEO said.
Breen added in which DowDuPont’s three-way split would certainly bring “three world-leading companies in their respective industries” to the market. He said they would certainly be “shareholder-friendly” when This kind of came to dividends, in addition to forecast share buybacks at all three entities “as soon as” the split can be completed.
DowDuPont’s stock slid 0.65 percent in Thursday’s trading session, settling at $59.44 a share. The stock dipped slightly in extended trading.
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