Friday, December 11, 2015

Dow-DuPont means layoffs: DuPont announces 10% job cuts for global workforce

Of course, now that the Christmas season is truly upon us, it means it's time for layoffs. This year is no different, with the Dow DuPont merger a real reality. From the Wall Street Journal today (by Jacob Bunge, David Benoit and Chelsey Dulaney): 
Dow Chemical Co. and DuPont Co. announced Friday that they have agreed to merge, fusing two stalwarts of American industry into a giant worth about $130 billion. 
The deal would reshape the chemical and agricultural industries and comes as sinking commodity prices and a strengthening U.S. dollar have pressured revenue at both Dow and DuPont. 
The companies plan to strip out about $3 billion in costs as they combine operations and ultimately break up into three separate businesses about 18 to 24 months after closing the deal. Those three resulting companies, which would be publicly traded, would be focused on agriculture, material sciences and specialty products. 
The union marks a new chapter for two of the oldest U.S. companies, which had both sought to reinvent themselves as makers of more-profitable products while facing pressure from major investors agitating for the companies to make faster, bolder moves...
Of course, there will be layoffs. From the same article:
Friday’s announcements will lead to major job cuts. DuPont said it is cutting about 10% of its global workforce in its restructuring ahead of the deal, and further reductions are likely as the combined company streamlines ahead of its planned breakup. 
Here's the official DuPont press release.

This is terrible news for all chemists involved, I feel. Best wishes to those affected.

UPDATE: Lots of current employee comments about DDP (my unofficial nickname, homage to Mr. Page Joseph Falkinburg) over at the Chemistry Reddit.

12 comments:

  1. I'm sorry to hear about more layoffs coming. Best wishes to those affected.

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  2. Dupont has been in the process of imploding for years. I received a job offer from them about 15 years ago. My late father, who retired from the Grasseli/Industrial & Biochemicals/AgChemicals Department after over 30 years, urged me to pass Dupont by.

    As in so many other things, he was right.

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  3. As a former DuPonter -
    DuPont's been self-mutilating itself for a good 25 years. They might as well make the final cut and gut themselves for good.

    I feel bad, however, for the current employees.

    I wonder if this merger is the real reason that Ellen Kuhlman quit as CEO back in October? Even back then there must have been talks going on between the two companies.

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  4. You mean hiring that guy who faked results in his thesis (and papers) wasn't a bold move?

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    1. http://blog.chembark.com/2013/11/07/suspicious-data-in-a-jacs-paper-from-2009/

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  5. I have always felt that large publicly traded companies tend to hire mediocre people. Many will insist that they only hire the best. If that's the case, it certainly doesn't show.

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    1. Do you work at one of these companies or is this just your hunch? I am genuinely curious about your basis for this belief.

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    2. Based on who got jobs at big companies. I will give one example, possibly worst PhD I've ever known ended up at Chevron. Thrown out of first group during 3rd year (for very good reasons, including not coming to work, taking long vacations without giving anyone notice, accepting internships without permission and while expecting to keep getting the grad stipend while being paid to do desk work at a company, etc.). Another group took the individual and had them for a year before awarding the PhD. No pubs. Job at Chevron. Then told me that they like to hire people who are shy but nice. That was their criteria. I even talked to this person's boss once, who indicated that he didn't like the competing candidate because he seemed to ambitious (as if people who get PhDs shouldn't be ambitious). Person in question got Chevron to pay for their MBA and then left Chevron to take a sales position at another company. This is but one example. If you want more examples I would be happy to supply it.

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  6. I saw an article about the merger in the Philadelphia Inquirer over the weekend:

    http://www.philly.com/philly/blogs/inq-phillydeals/Dow-DuPont-to-merge-then-split-into-3.html

    Direct quotation from this article:

    "Hedge-fund investors Loeb and Peltz had expressed impatience with the chemical giants' large management structures and the slow or hard-to-measure pace of scientific research and product development, and called for asset sales and cost cuts that will make it easier for them to extract cash."

    Looking into these two investors, I found that (Nelson) Peltz was engaged in a proxy fight with DuPont earlier this year. At that time, DuPont triumphed (Ellen Kullman was still CEO at the time), but it looked like a nasty battle. Here is one article I found on that subject:

    http://fortune.com/2015/05/11/how-dupont-went-to-war/

    Looks like Peltz is getting his way...

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    1. The technical layoffs started quietly in January of 2015(low key)I know, as I was one of them, then Kullman made it look like this was so terrible by exiting as CEO(by the way, where is she, vacationing). She will get her share(s), I am sure....by the way the stock is plummeting again, buy back time for the big owners of stock....Happy Ground Hog's day Duponters!

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