Eastman Chemical Company on October 25 announced it has entered into a definitive agreement with DAK Americas LLC to sell the PET business and related assets and technology of its Performance Polymers segment. The transaction is expected to close during the fourth quarter of 2010. The total cash proceeds of the transaction are expected to be $600 million, with the final purchase price subject to working capital adjustments at closing. The company expects to recognize a modest gain from the sale.
“After reviewing strategic options for our Performance Polymers PET business, we determined this action to be the most beneficial to Eastman and our stockholders,” said Jim Rogers, Eastman president and CEO. “With the path forward for PET now clear, we are dedicating all of our energies to leveraging our solid core businesses and strong balance sheet to deliver value creating growth.”
The sale, which is subject to regulatory approvals and satisfaction of other customary closing conditions, is not expected to impact product lines in the company’s Specialty Plastics segment.
Financial results for the Performance Polymers segment will be reported as discontinued operations in fourth quarter 2010. The treatment of these financial results as discontinued operations is not expected to have a material impact on the company's earnings from continuing operations in fourth quarter and full year 2010. In conjunction with the sale of the Performance Polymers PET business, the company has approved a restructuring plan to reduce costs and will recognize severance restructuring charges in the fourth quarter.
Eastman’s chemicals, fibers and plastics are used as key ingredients in products that people use every day. Approximately 10,000 Eastman employees around the world blend technical expertise and innovation to deliver practical solutions. The company is committed to finding sustainable business opportunities within the diverse markets it serves. A global company headquartered in Kingsport, Tenn., Eastman had 2009 sales of $5 billion.