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Dupont sets Conoco terms
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July 9, 1999: 5:26 p.m. ET
Chemical maker reveals details for sale of remaining 70 percent of oil unit
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NEW YORK (CNNfn) - DuPont Co., the biggest U.S. chemical producer, Friday announced the terms it will provide to its shareholders for the sale of the 70 percent stake it holds in Conoco Inc., the Houston-based oil company.
DuPont last year sold 30 percent of Conoco as part of its bigger plan to focus on its chemicals businesses. The Wilmington, Del.-based company raised $4.4 billion from that sale, one of the largest initial public offerings in the world.
Now the company is shedding the remaining 70 percent of Conoco through a stock swap with shareholders before the end of the year. Rather than calling the transaction a spinoff, where shareholders usually receive new shares of the company being sold, DuPont is calling the transaction a "split-off," because stockholders will have a choice whether to swap their shares or not.
The ratio will be one common share of DuPont stock in exchange for 2.95 shares of Conoco Class "B" stock currently held by DuPont, to a maximum of 148 million shares. That's a premium of about 18 percent. The exchange is to be based on Thursday's closing prices of both companies. DuPont (DD) ended the day Thursday at 68-5/8, while Conoco (COC) closed Thursday at 27-3/8.
In Friday trading, DuPont shares climbed an additional 2-3/4 to 71-1/4 on volume of almost 12 million shares, significantly higher than the companies daily trading average during the past three months. Conoco shares slipped 7/8 to 26-1/2.
The split-off is still subject to approval by the Securities and Exchange Commission and by DuPont's board of directors.
The offering, which is expected to begin Monday and expire at midnight on August 6, could be delayed if market conditions aren't appropriate, the company said. The company is also awaiting word from the Internal Revenue Service that its transaction can be classified as tax-free. 
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