Multinational chemicals company DuPont de Nemours announced Wednesday that it will split into three independent publicly traded companies, separating its electronics and water businesses from its core business, which will carry on as a diversified industrial company. Here’s how the businesses will shake out: 

• Electronics: DuPont says this entity will be a provider of key consumables used in semiconductor-chip manufacturing, positioning it to capture growth driven by the computing demands from AI.
• Water: This entity will be a “global technology leader” with a portfolio of water filtration and purification solutions, DuPont says.
• New DuPont: Finally, “New DuPont” will continue its focus on industrial materials with a strong presence in healthcare. 

Timeline for the DuPont split and what it means for shareholders

The company says it expects the separations to be executed within the next two years and that they will be completed in a way that is tax-free for DuPont shareholders. The move is not subject to a shareholder vote, although the specifics will require approval from the company’s board as well as regulatory approval.

According to DuPont, benefits of the separation include more flexibility to pursue mergers and acquisitions, as well as distinct management teams for each business, which are skilled in creating value for the specific industry.

Along with the news of the split, the company announced a change in leadership, selecting DuPont’s current chief financial officer, Lori D. Koch, to replace Edward Breen as chief executive officer, effective June 1. 

DuPont is adding to a growing legion of iconic companies that have split up their different businesses, such as General Electric, which announced it would split into three separate companies (aviation, healthcare, and energy) back in November 2021. More recently, food giant Kellogg Company completed a split into Kellonova and WK Kellogg Co.

Shares of DuPont are trading higher following the announcement, up 0.30% in early afternoon trading, sitting at $78.79.