Wilmington, Del.—DuPont has initiated the latest step in its strategy to be a sustainable growth company by dividing itself into five businesses and breaking off its textiles, fibers and interiors operations to a wholly owned subsidiary with the ultimate intention of spinning it into a standalone company by the end of 2003. Representing 23% of the company’s total annual revenues, the new DuPont Textile & Interiors (DTI) will encompass the flooring, apparel and related businesses including the operations which manufacturer ny lon. Within its portfolio will be some of DuPont’s most powerful brands, including Stainmaster, Antron, Lycra, Dacron, Coolmax, Thermolite, Supplex, Cordura, Tactel and Micromattique.

The subsidiary will also be able to leverage other known consumer names, including Teflon and the corporate moniker in DuPont. DTI will have annual revenues of approximately $6.5 billion with operations in 50 countries and 22,000 employees. It will be run as two businesses, Textiles and Interiors, and Intermediates. Each will have subgroups. Flooring, apparel, home and industrial will fall under the Textiles and Interiors unit, while nylon, Terathane and polyester intermediates, specialties and joint ventures will be placed in Intermediates. Flooring and apparel will make up DTI’s largest businesses with both contributing up to 90% of the company’s revenues. “Our nylon, polyester and Lycra businesses have played a very important role in DuPont for many decades,” said Charles Holiday, chairman and CEO. “They have served our company, our shareholders and our customers extremely well.

Now, with rapidly changing industry dynamics and tough market realities, we believe the course we have chosen is necessary to allow these businesses to succeed in the future.” “Upon formation, DTI is the largest player in the worldwide textile and interiors business,” said Richard Goodmanson, DuPont’s executive vice president and COO and the person chosen to head DTI’s leadership team. “With a portfolio of brands that is second to none, we will enjoy the number one position in the six markets that comprise 75% of our revenues. “This new subsidiary will focus on innovation, research and development, cost efficiencies, manufacturing efficiencies and responsiveness to our customers around the world,” he added. In addition to Goodmanson, DTI’s leadership team consists of Steven McCracken, group vice president and general manager DuPont Apparel & Textile, who was named to lead the downstream business, while George MacCormack, group vice president and general manager DuPont Chemicals & Polyester, was picked to lead the upstream business.

The management team for the flooring part of the operation will remain intact: Alan Wolk, vice president and general manager DuPont Flooring Worldwide; Steve Griffith, residential business director; Dave Bouten, commercial business director; Bobby Berrier, transportation business manager; Ana Torrence, rugs business manager; Gary Johnston, marketing brand communications manager, and Bob Axtell, CEO of DuPont Flooring Systems (DFS).

To ensure DTI maintains its leading market positions, DuPont has earmarked $170 to the subsidiary for product and process innovation during 2002. “This is solely for research and development,” Johnston said, “and represents more than what would be allocated during a typical year. This is just proof that DuPont wants DTI to not only be successful but remain on the cutting edge of technology.” “Our new company will demonstrate its commitment to innovation, competitiveness and brands to help our customers differentiate themselves in an increasingly competitive and commodity-oriented environment,” McCracken noted. “DuPont Nylon Flooring will continue to offer the same quality and responsiveness as always, while providing greater speed, flexibility and strong global market channel access,” said Wolk. He noted how the spin off has created “a renewed sense of vigor” within the company because it puts the operation in a better position to meet customer needs. “It also gives us the opportunity,” he added, “in establishing and further leveraging brands such as Stainmaster and Antron through aggressive marketing programs.

The commitment of DuPont Flooring to customers and their needs will remain a core value to create a successful business environment for all levels of the value chain.” As one executive put it, DTI has been packaged in such a way the industry now has an 800 pound gorilla that is very agile, focused and brand oriented. “We are built for the long run,” Johnston explained. “DuPont has taken special care to make sure there are no pitfalls or mishaps. The mistakes made by others in similar situations will not be made here. For example, we are not saddled with debt. DuPont wants DTI to hit the ground running and it has given us the flexibility and resources we need to be aggressive and innovative.” —Matthew Spieler