Boca Raton, FL, Feb. 19--DuPont Co. may use some of the $4.4 billion of proceeds from the sale of its Invista fibers unit for small acquisitions, DuPont's chief executive said on Thursday.
"Smaller (or) what we call bolt-on acquisitions that fit very well with our products ... have paid out very well for us," said CEO Charles Holliday in an interview during a break at the Business Council meeting of top U.S. executives.
No final decisions about how to use the proceeds have been made, though some will be used to pay down debt, he said.
DuPont has made 22 small acquisitions in recent years, spending $600 million to $700 million annually to add businesses to its coatings, performance materials and other divisions. These have grown faster than the Invista unit the company agreed in November to sell to Koch Industries.
The Wilmington, DE based company, established in 1802 and one of the oldest U.S. companies, will also consider stock buybacks with some of the Invista money, which should net $4.2 billion after taxes, Holliday said.
Holliday said the Invista transaction is well on its way to receiving regulatory approval. "We are awaiting the final government approvals, but that is going along very well," he said. "We believe that will take place in the first half of this year."
Holliday said he sees no quick end to high natural gas prices, which in the United States are the highest in the world, having roughly doubled since the late 1990s. The costly fuel has savaged profitability at chemical companies, which use natural gas as both a raw material and for power.
DuPont, whose Invista fiber-making unit is especially vulnerable to rises in feedstocks, has overhauled processes in its plants with an eye to cutting the use of natural gas, he said. DuPont has called on its workers to suggest savings.
"Things we were doing 15 years ago we are revitalizing," he said.
So far, he said, the jump in natural gas prices has not forced plant closures or production shifts from the United States.
"Our plants don't move very easily. They are generally great big plants," he said. "But, as you think about the next plant you are going to build, I need to build it in the most economical place I can."
