By Jacob Bunge And Angela Chen
DuPont Co. agreed to sell its namesake theater as the chemical
company faces a high-profile proxy fight with an activist investor
that has criticized its hospitality businesses as examples of
corporate bloat.
The Grand Opera House Inc., an entertainment group based in
Wilmington, Del., plans to acquire the 101-year-old DuPont Theatre
from the company, in a deal that DuPont Chief Executive Ellen
Kullman called "a strategic and mutually beneficial business
decision."
Financial terms weren't disclosed.
The deal comes after Nelson Peltz's Trian Fund Management LP in
September launched a public campaign to split up DuPont's
businesses and free them from what Trian called a cumbersome and
costly corporate structure. The fund spotlighted the theater, as
well as an attached 12-story hotel and nearby country club also
owned by DuPont, as examples of what the fund claimed were $2
billion to $4 billion in unnecessary annual expenses.
Last week, Trian nominated four director candidates to DuPont's
board, including Mr. Peltz, the fund's CEO, to be put before a
shareholder vote likely in April.
DuPont, defending its governance and business strategy, has
touted its stock market-beating performance under Ms. Kullman,
along with shareholder-friendly moves like a $5 billion stock
buyback and a plan to cut $1 billion in annual costs.
The Wilmington, Del., company has said the hospitality
businesses posed no significant burden on DuPont. A spokesman said
Monday that the company remains open to selling its country club
and hotel "if appropriate value can be received for
shareholders."
A spokeswoman for Trian declined to comment.
The DuPont Theatre opened in October 1913, shortly after the
opening of the attached Hotel du Pont, with ticket prices starting
at 25 cents. Then-company President Pierre S. du Pont commissioned
both operations at a time when DuPont's expansion was fueling a
growing population in Wilmington, where the company began as a
gunpowder mill in 1802.
The Grand, which operates the 144-year-old Grand Opera House in
Wilmington, plans to rename the DuPont Theatre as The Playhouse on
Rodney Square, according to a statement from the companies.
DuPont shares were 1.8% higher in afternoon trading Monday, at
$74.80.
David Benoit contributed to this article.
Write to Jacob Bunge at jacob.bunge@wsj.com and Angela Chen at
angela.chen@dowjones.com
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