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News > Deals
DuPont sets Conoco IPO
September 28, 1998: 2:53 p.m. ET

Chemical maker to offer minority stake in energy unit, spin off remainder
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NEW YORK (CNNfn) - Chemical giant DuPont Co. said Monday it will offer a 10 percent to 20 percent stake in its Conoco oil and gas unit to the public this year and spin off its remaining interest to shareholders in 1999.
     The tax-free spin-off, expected to close within 12 months, will mark DuPont's exit from the energy business.
     Conoco, which DuPont acquired in 1981, is the world's eighth-largest oil production company, with revenue of approximately $22 billion. DuPont had revenue last year of $45 billion.
     Conoco filed for an initial sale of 150 million shares, putting a value of $15-$18 billion on the company or $3 billion to $3.6 billion for the 20 percent share being offered by DuPont.
     If demand warrants, Conoco could expand the offering to sell an additional 22.5 million shares.
     The news sent DuPont shares (DD) up 2-3/8, or about 4.15 percent, to 61-1/8 in mid-afternoon Monday trading on the New York Stock Exchange.
     "In May we announced that DuPont would exit the energy business so that DuPont and Conoco could better capitalize on market opportunities to make both companies stronger," DuPont President and Chief Executive Charles O. Holliday Jr. said.
     "Since that announcement, we have evaluated all available exit options and have determined that the IPO and split-off will offer the most value to shareholders, as well as position both companies for future success."
     Earlier this year, DuPont announced it would spin off 20 percent of Conoco, then sell the remaining 80 percent over the next several years.
     According to a British newspaper, French oil concern Elf Aquitaine wants to buy Conoco for $24 billion. DuPont and Elf Aquitaine (ELF) have declined to comment on the report.
     Mobil Corp. also has been named as a potential buyer.
     In August, British Petroleum PLC agreed to acquire Amoco Corp. in a deal valued at approximately $48 billion, making it the biggest-ever industrial merger. Back to top
     -- from staff and wire reports

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