Qnity Electronics to offer $2.5 billion in notes ahead of DuPont spin-off

WILMINGTON - Qnity Electronics, Inc. plans to offer $2.5 billion in notes to fund its upcoming separation from DuPont de Nemours, Inc. (NYSE:DD), a $29.5 billion market cap chemical giant that InvestingPro analysis shows is currently trading below its Fair Value. According to a press release issued Monday.

The offering will consist of $1.5 billion in senior secured notes due 2032 and $1 billion in senior notes due 2033. The proceeds will be held in escrow until the completion of DuPont’s previously announced spin-off of its electronics business, targeted for November 1, 2025. With annual revenue of $12.6 billion and a FAIR financial health score according to InvestingPro analysis, DuPont maintains a strong position to execute this strategic move.

Upon release from escrow, Qnity intends to use the funds, along with borrowings under new senior secured credit facilities and cash on hand, to finance a cash distribution to DuPont plus a pre-funded interest deposit.

The secured notes will be backed by first-priority liens on collateral that also secures Qnity’s planned senior secured credit facilities, while the unsecured notes will not be secured by any collateral. Both series will be guaranteed by Qnity subsidiaries that are borrowers or guarantors under the company’s planned senior secured credit facilities.

If the spin-off is not completed by March 31, 2026, or if Qnity determines it will not proceed with the separation, the notes will be subject to a special mandatory redemption. DuPont’s strong track record of maintaining dividend payments for 55 consecutive years and analysts’ strong buy consensus demonstrate the company’s commitment to shareholder value, with additional insights available through InvestingPro’s comprehensive research reports.

The notes will be offered to qualified institutional buyers in the United States under Rule 144A of the Securities Act and to non-U.S. investors under Regulation S. They have not been registered under the Securities Act and cannot be sold in the United States without registration or an exemption.

Qnity, described as a technology solutions provider across the semiconductor value chain, will become an independent company following the spin-off, which does not require shareholder approval but remains subject to final board approval, tax opinion, regulatory clearances, and completion of financing.

In other recent news, DuPont reported second-quarter earnings that exceeded expectations, with guidance for the third quarter and full-year 2025 surpassing consensus estimates. RBC Capital responded by raising its price target for DuPont to $94, maintaining an "Outperform" rating. Similarly, KeyBanc increased its price target to $92, citing strong performance in the electronics, water, and healthcare segments, despite weaknesses in industrial and building & construction markets. In a significant legal development, DuPont, along with Chemours and Corteva, agreed to a proposed $875 million settlement with New Jersey to resolve environmental contamination claims, pending approval by the Federal District Court of New Jersey. Additionally, DuPont announced that China’s State Administration for Market Regulation has suspended its antitrust investigation into the company’s Tyvek business. This investigation had been initiated in April due to alleged anti-monopoly law violations amid trade tensions between China and the United States. These developments highlight recent strategic and operational shifts for DuPont.

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