DuPont exec defends cellulosic ethanol plant in Nevada
Source: By Donnelle Eller, Des Moines Register • Posted: Thursday, October 9, 2014
Bloomberg reported that activist investor Nelson Peltz has singled out the plant as an example of the Wilmington, Del.-based company’s “speculative and expensive corporate science projects” that have “destroyed shareholder value.”
The $225 million plant, now under construction in Nevada, will use crop residue — corn cobs, leaves and stalks — to make ethanol. It’s expected to open later this year.
DuPont’s William Feehery said the plant will pay off as companies such as Procter & Gamble Co. add to demand for renewable chemicals and fuels. He spoke toBloomberg’s Patrick Winters and Jack Kaskey at a Switzerland conference.
“This plant will make money,” said Feehery, president of the industrial biosciences unit at at the World Conference on Fabric & Home Care in Montreux. “We put a lot of time and R&D money into this.”
Peltz disclosed his Trian Fund Management LP’s interest in DuPont last year and has has pushed the chemical giant to break itself up into two distinct companies. He believes DuPont has $4 billion in excess corporate costs that can be cut.
Since then, Dupont CEO Ellen Kullman has announced cuts in administration, a share buyback worth $5 billion and a spinoff the company’s performance chemicals unit, a commodity business that has more volatile earnings than other segments.
DuPont also owns the Johnston-based seed company, Pioneer.