Summary
E. I. du Pont de Nemours and Company (DuPont) announced a significant increase in its planned contributions to its principal U.S. defined benefit pension plan for 2017. The company now expects to contribute approximately $2.9 billion, a substantial increase of $2.7 billion from its prior anticipation of $230 million. This expanded contribution is expected to be funded through a combination of debt, short-term borrowings (including commercial paper), and cash. To facilitate these contributions, DuPont completed a large public offering on May 2, 2017, raising $1.25 billion in 2.200% Notes due 2020 and $750 million in Floating Rate Notes due 2020, totaling $2 billion. The company has also filed legal opinions regarding the validity of these notes. This substantial pension funding and debt issuance are key events for investors to monitor regarding the company's financial strategy and liabilities.
Key Highlights
- 1DuPont significantly increased its 2017 planned contributions to its U.S. defined benefit pension plan to approximately $2.9 billion, up from a prior expectation of $230 million.
- 2The increase in pension contributions is approximately $2.7 billion and is discretionary.
- 3The company plans to fund these contributions through a mix of debt, short-term borrowings (including commercial paper), and cash.
- 4DuPont completed a $2 billion public offering of notes on May 2, 2017, consisting of $1.25 billion in 2.200% Notes due 2020 and $750 million in Floating Rate Notes due 2020.
- 5The offering of notes was made pursuant to a registration statement on Form S-3.
- 6Legal opinions regarding the validity of the issued notes have been filed.
- 7The filing also includes standard cautionary statements regarding forward-looking information, referencing ongoing merger activities with Dow Chemical and a transaction with FMC Corporation.