Long-term Value

TAKEAWAY: LONG-TERM VALUE

GUPTA:
As you say, you always think about not incremental change and steady as it goes, but think about step change and the value creation over the long term. How do you see that playing out in this DuPont-Dow merger?

BREEN:
Well, so I looked at it when I was a board member, and there was kind of four things in my mind when I thought, boy, we could really accelerate this company. One was I thought we could improve the organic growth rate of the company with some things I had in my mind. I won't bore you with that now—take too long. Secondly, I thought the company needed to streamline its G&A structure. Unfortunately, that was painful. We took a billion dollars of cost out of the system. The company's running better because of it. We also restructured the way we run it, so we did that.

But what the big prize in my mind was—wow, if we could merge with Dow and we're going to end up—we're going to merge with them and then we're going to separate 18 months later. Instead of separating back into two, we're going to separate into three companies—a materials science company, an agriculture company (one of the bigger ones in the world), and a specialty company, which will have some of Raj's old businesses in it, actually. I think that’s a better way to organize it. It's going to create more value. They're each going to have the right balance sheet for their businesses, so they can grow and do their thing. And we're going to set them up with a great capital structure and just move on. I think it'll be good.

By the way, I'm not a one-year guy. I think long term. But our stock's up 60% since we did all this from a year ago. So I think the marketplace and some of you investors in the room are like, I think this is a pretty good strategy. There's a lot to execute in the next two years, but I think there’s going to be really three great companies come out of this.