SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of Earliest Event Reported) March 15, 1999
E. I. du Pont de Nemours and Company
(Exact Name of Registrant as Specified in Its Charter)
Delaware 1-815 51-0014090
(State or Other Jurisdiction (Commission (I.R.S Employer
of Incorporation) File Number) Identification No.)
1007 Market Street
Wilmington, Delaware 19898
(Address of principal executive offices)
Registrant's telephone number, including area code: (302) 774-1000
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Item 5. Other Events
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In connection with Debt and/or Equity Securities that may be offered
on a delayed or continuous basis under Registration Statements on Form S-8
(No. 33-53327, No. 33-61339 and No. 33-60069), we hereby file the following
press release.
Contacts: Susan Gaffney Mike Ricciuto
DuPont DuPont
(302) 774-2698 (302) 892-7996
Tim Martin Jerry Harrington
Pioneer Pioneer
(515) 334-6837 (515) 334-6908
DUPONT AND PIONEER HI-BRED INTERNATIONAL INC.,
SIGN MERGER AGREEMENT
WILMINGTON, Del./DES MOINES, Iowa, March 15 -- DuPont and Pioneer
Hi-Bred International, Inc., today announced that they have signed a
definitive agreement for a stock and cash merger that will result in DuPont's
complete ownership of Pioneer. This transaction is another major step in
DuPont's life sciences strategy and will strengthen and accelerate its
capability to discover, develop and commercialize a new generation of products
across the value chains for food and feed crops, food ingredients, industrial
applications and nutrition science. DuPont currently has a 20 percent equity
interest in Pioneer.
Under the terms of the agreement, Pioneer shareholders will receive
$40 per share, with 45 percent of the shares receiving cash and 55 percent of
the shares receiving DuPont stock. Pioneer shareholders will have certain
rights to elect which form of consideration they receive. The merger is
expected to close during the summer of 1999. The total equity value of the
transaction is estimated to be approximately $7.7 billion for the 80 percent
of Pioneer not currently owned by DuPont.
The boards of directors of both companies have approved the trans-
action.
"This transaction will further enhance an already outstanding tech-
nology platform and marketing capability, while giving us greater ability to
speed new products to market and deliver value across the agriculture and
nutrition industries," said Charles O. Holliday, Jr., DuPont chairman and
chief executive officer. "Our excellent relationship with Pioneer has grown
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even stronger during the last 18 months, enabling us to create further
synergies by totally integrating DuPont's biology, chemistry and genomics with
Pioneer's leading market position and research and development capabilities.
The end result should be significantly increased shareholder value."
Holliday added, "Both companies are customer focused with compatible
cultures and values. By bringing together DuPont's Ag businesses and
Pioneer's seed business, we are creating an agricultural enterprise with
$5 billion in annual sales, which will be focused on growth."
"Crop genetics offer tremendous potential for meeting the needs of
farmers, agriculture and consumers around the world," said Charles S. Johnson,
who will continue to lead Pioneer as chairman, president and chief executive
officer. "Bringing the talents and resources of our two companies more
closely together will ensure we deliver that potential to the market and do it
quickly."
The transaction will increase DuPont's ability to create output trait
offerings based on its own products or on complementary licensed products. It
also will increase the speed to market of these products and will strengthen
DuPont's custom offering to food companies. Longer range, DuPont's and
Pioneer's combined R&D capabilities in biotechnology will create a stronger
scientific platform on which to build biomaterials opportunities.
Pioneer is the world's largest seed company, the most recognized seed
brand in the world, and a leader in North America and other key markets. Its
strength rests on the quality of its proprietary germ plasm, as well as a
highly respected brand franchise and integrated product and distribution
systems. Pioneer introduced 37 new corn hybrids in 1998 and has introduced 60
new hybrids this year, including high-oil, herbicide and insect-resistant
products.
As a wholly owned subsidiary of DuPont, Pioneer will continue to do
business under the Pioneer name and will remain headquartered in Des Moines,
Iowa. It has 5,000 employees worldwide. In the year 2000, the first full
year of combined operations, DuPont expects dilution in cash earnings per
share of about 1 percent. Fully diluted earnings per share will be reduced by
about 7 percent.
Last week DuPont announced two strategic efforts to aggressively and
rapidly build its life sciences portfolio. First, the company said that it is
actively seeking alliances with other strong partners in the pharmaceuticals
industry to bring DuPont Pharmaceuticals to critical mass through strategic
alliances. Additionally, the company said its board has authorized actions
toward the creation and issuance of a "tracking" stock for its life sciences
businesses to give DuPont the financial flexibility to more advantageously
participate in industry consolidation trends and expand the portfolio.
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In September 1997, DuPont and Pioneer formed a research alliance and
in January 1998, a separate joint venture company -- Optimum Quality Grains,
L.L.C. DuPont also invested $1.7 billion in Pioneer to acquire a 20 percent
equity interest. DuPont's total investment, including the value of today's
transaction, will be approximately $9.4 billion. It currently holds two of
the 14 seats on Pioneer's board of directors.
Credit Suisse First Boston and Salomon Smith Barney acted as financial
advisors to DuPont and Lazard Freres & Co. LLC acted as financial advisor to
Pioneer.
Skadden, Arps, Slate, Meagher, & Flom LLP acted as legal counsel for
DuPont and Fried, Frank, Harris, Shriver, and Jacobson acted as legal counsel
for Pioneer.
Pioneer Hi-Bred International, Inc., (NYSE-PHB) is the world's leading
supplier of agricultural genetics and is the leading developer and integrator
of agricultural technology. Headquartered in Des Moines, Iowa, Pioneer
develops, produces, and markets a full line of seeds, forage and grain
additives and services to grain and livestock producers, grain processors and
other customers worldwide.
Founded in 1802, DuPont is a global science and technology-based
company. DuPont serves worldwide markets including food and nutrition; health
care; agriculture; fashion and apparel; home and construction; electronics;
and transportation. The company operates in more than 70 countries and has
92,000 employees.
Forward-Looking Statements: This news release contains forward-
looking statements based on managements' current expectations, estimates and
projections. All statements that address expectations or projections about
the future, including statements about the company's strategy for growth,
product development, market position, expected expenditures and financial
results are forward-looking statements. Some of the forward-looking state-
ments may be identified by words like "expects," "anticipates," "plans,"
"intends," "projects," "indicates," and similar expressions. These state-
ments are not guarantees of future performance and involve a number of risks,
uncertainties and assumptions. Many factors, including those discussed more
fully elsewhere in this release and in DuPont's filings with the Securities
and Exchange Commission, particularly its Current Report on Form 8-K filed on
November 13, 1998, as well as others, could cause results to differ materially
from those stated. These factors include, but are not limited to changes in
the laws, regulations, policies and economic conditions of countries in which
the company does business; competitive pressures; successful integration of
structural changes, including acquisitions, divestitures and alliances;
failure of the company or related third parties to become Year 2000 capable;
research and development of new products, including regulatory approval and
market acceptance.
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3/15/99
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
E. I. DU PONT DE NEMOURS AND COMPANY
(Registrant)
/s/ D. B. Smith
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D. B. Smith
Assistant Controller
March 15, 1999
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