Specialty polymer materials maker PolyOne Corporation (POL) announced the sale of its vinyl dispersion, blending and suspension resin assets to Mexichem, S.A.B. de C.V. for $250 million in cash. The sale is subject to regulatory approvals and fulfillment of other closing conditions.
PolyOne’s resin assets formed a part of its Performance Products and Solutions segment and are involved in the direct manufacture of base resins. PolyOne stated that its decision to sales the assets is a part of its strategy to realign its portfolio.
PolyOne’s resin assets generated revenues of $147 million in 2012. The sale is expected to dilute the earnings of PolyOne by about 22 cents per share in 2013. However, PolyOne’s earnings target for 2015 to remain at $2.50 per share.
The divestiture of the base resin assets is consistent with PolyOne’s strategy of focusing on its core competence of material science formulation for specialty applications. This is in sync with the improvement strategy, which has delivered substantial shareholder value over the last five years.
PolyOne is a leading provider of specialized polymer materials, services and solutions. It has annual sales of $3 billion and operations around the world.
In Jan 2013, the company released its fourth-quarter 2012 results with adjusted earnings (excluding special items) of 21 cents per share, in line with the Zacks Consensus Estimate but roughly 17% higher than the year-ago earnings of 18 cents per share. Profit, as reported, fell to $3.1 million or 3 cents per share from $12.3 million or 13 cents per share a year ago.
Revenues came in at $679.4 million in the quarter, up 6% from $640.4 million in the year-ago quarter, beating the Zacks Consensus Estimate of $663 million.
PolyOne made several achievements in 2012, including the successful integration of ColorMatrix, a deal to acquire of Spartech and the completion of the Glasforms buyout.
PolyOne currently maintains a Zacks Rank #3 (Hold).
Other companies in the chemical-plastics space with favorable Zacks Rank are Tredegar Corp. (TG), Westlake Chemical Corp. (WLK) and A. Schulman, Inc. (SHLM). While Tredegar and Westlake retain a Zacks Rank #1 (Strong Buy), Schulman holds a Zacks Rank #2 (Buy).
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