By Tom Hals
WILMINGTON, Del. (Reuters) - DuPont
Peltz's Trian Fund Management had sought four seats on the board, including one for himself, and pushed the 213-year-old company to split its businesses to unlock more value for shareholders.
Trian conceded defeat, while saying the vote was close. DuPont said it expected an independent inspector to certify the preliminary voting results shortly.
DuPont shares were down 6.4 percent at $69.63 in heavy trading after the results were announced, making it the top percentage loser in the Standard & Poor's 500 index <.SPX>.
The vote ends a high-stakes corporate drama that revved up in January when Trian announced its dissident board slate for DuPont. Trian holds a 2.7 percent stake in the company, making it the fifth-largest shareholder.
Chief Executive Officer Ellen Kullman said DuPont spent several months explaining to investors how the company has changed, including its plans to spin off its performance chemicals business in the next two months.
?We don?t tell our story well enough and have undergone a lot of change," Kullman told reporters at the annual meeting in DuPont's hometown of Wilmington, Delaware.
In particular, the company reached out to its retail investor base, which accounts for more than a third of shares.
"They normally don?t vote as often as they should, but apparently we got their attention this time, and they were active,? she said. The annual meeting drew 400 shareholders.
DuPont, a Dow Jones industrials <.DJI> component with a market value of $68 billion as of Tuesday, had warned that Trian would try to establish a "shadow management" team and undermine the company's transformation.
Peltz said on Wednesday that DuPont had already made important changes at the prompting of Trian, including cost cuts and a share buyback. "We don't believe these things would have occurred without our involvement," he said.
Suntrust Robinson Humphrey analyst James Sheehan said DuPont's victory reflected its many longtime shareholders, including small investors. There was not "a sufficient level of disgruntlement with the existing management team," he said.
Sheehan expects Trian to keep agitating for change. "If DuPont?s financial performance stumbles," he said, "they can easily mount this proxy fight again and possibly prevail."
Before the meeting, Trian's alternate slate had won at least partial public backing from proxy advisory firms such as ISS and the California State Teachers' Retirement System, which owns 3.6 million DuPont shares.
While Peltz said on Wednesday that Trian had strong support from institutional investors, he acknowledged the need to spend more time with retail investors and index funds.
Evercore Partners Inc
(Additional reporting by Swetha Gopinath in Bengaluru; Writing by Lewis Krauskopf in New York; Editing by Michele Gershberg, Lisa Von Ahn)
