By Pranav Mathur and Vallari Srivastava
(Reuters) -DuPont will sell its heat-resistant fiber business Aramids, home to brands such as body armor maker Kevlar, to peer Arclin for $1.8 billion as the chemicals company undergoes a broader reorganization.
The sale will not affect the planned separation of its electronics business in November, DuPont said on Friday, as the company attempts to streamline its portfolio.
Lower exposure to the "legacy" Aramids business would aid DuPont's growth and margin profile
in the near-term, helping the company achieve a better valuation post the spinoff, said RBC Capital Markets analyst Arun Viswanathan.
The chemicals industry has been struggling with higher energy costs, as well as weak demand and prices, especially in European markets where strict regulations have raised the cost of manufacturing.
The company expects pre-tax cash proceeds of about $1.2 billion upon the sale's close, along with a note receivable of $300 million and a non-controlling stake valued at $325 million in Arclin.
RBC's Viswanathan expects proceeds from the Aramids sale and the electronics unit spinoff to likely be used for acquisitions, share buybacks and deleveraging.
DuPont's sale of the Aramids portfolio, which includes protective clothing maker Nomex, is expected to close in the first quarter of 2026.
Shares of the company were up marginally at $77.56 in morning trade.
(Reporting by Pranav Mathur and Vallari Srivastava in Bengaluru; Editing by Devika Syamnath)
