Home / Knowledge / News / Textiles / Solutia agrees to sell nylon business
Solutia agrees to sell nylon business
01
Apr '09
Solutia Inc announced it has entered into a definitive agreement to sell its nylon business to an affiliate of SK Capital Partners II, L.P., a New York-based private equity firm that is focused on the chemical, material and health care sectors. At the closing of the sale, Solutia will receive $50 million in cash and a two percent equity stake in a new company formed to hold substantially all of the assets of the nylon business.

Solutia will also receive $4 million in deferred cash payments to be paid in annual $1 million installments beginning in 2011. The agreement includes a minimum level of working capital to be delivered at closing, which is approximately $100 million lower than the actual reported balance at the end of 2008 and approximately $25 million lower than the expected balance at the end of the first quarter.

The affiliate of SK Capital will assume substantially all of the liabilities of the nylon business, including employee and pension liabilities relating to the active employees of the business, and environmental liabilities. Solutia will use the nylon sale proceeds to pay down debt under its asset-based revolving credit facility.

In addition, SK Capital will secure replacement of $25 million of letters of credit associated with the nylon business, which will result in increased availability for Solutia under its credit agreements.

"Following this divestiture, Solutia will have completed its transformation into a pure-play performance materials and specialty chemicals company, with a portfolio of high-value products with world-leading positions," said Jeffry N. Quinn, chairman, president, and CEO of Solutia Inc. "Solutia is well positioned to generate consistent financial returns and to further develop and enhance its portfolio in the specialty chemicals sector."

James M. Sullivan, executive vice president and CFO, Solutia Inc., added, "Despite the challenging global economic conditions, we are pleased to have reached an agreement with SK Capital that provides fair value to Solutia stakeholders and advances the overall strategic positioning of the company."

Quinn added, "The nylon sale is a positive step toward securing Solutia's future. We recognize that we are operating in an unprecedented economic environment and we remain focused on cost reduction, operational efficiency, cash flow generation, liquidity, and covenant compliance."

The nylon business sale includes the business' management and employees, as well as all five of its manufacturing plants: Alvin, Texas (Chocolate Bayou); Decatur, Alabama; Greenwood, South Carolina; Pensacola, Florida; and Foley, Alabama.

"We believe this transaction positions the nylon business to achieve its full potential," added Quinn. "The business was the core of Solutia for many years and before that was the centerpiece of the former Monsanto's chemical business for decades. The combination of the highly dedicated men andwomen of the business along with the experienced SK Capital team marks the beginning of a new chapter for the business."

The transaction is subject to various closing conditions. Solutia anticipates the sale will close in the second quarter of 2009.

Solutia Inc


Must ReadView All

Global economic upswing became broader & stronger: IMF

Textiles | On 19th Apr 2018

Global economic upswing became broader & stronger: IMF

The global economic upswing that began around mid-2016 has become...

Courtesy: ITMA

Textiles | On 19th Apr 2018

ITMA 2019 expanding space due to overwhelming response

Due to overwhelming response, the exhibition space has been increased ...

BIDA’s Europe trip to showcase a different Bangladesh

Apparel/Garments | On 19th Apr 2018

BIDA’s Europe trip to showcase a different Bangladesh

The Bangladesh Investment Development Authority (BIDA) is taking a...

Interviews View All

Binoy Ravjani
Hero's Fashion

‘One of the recent trends in hand block printing is the indigo process,...

Top executives
Textile & apparel bodies

Textile industry would like to see inclusion of cotton yarn under MEIS and ...

Pratik Bachkaniwala
Palod Himson Machines

Fabric processing machines are picking up

Sugandha Bhardwaj

<div>New Delhi-based Brinjal Designs Pvt Ltd manufactures home furnishing...

Riddhi Jain

Conceived in Europe and curated in New Delhi, NeceSera is a...

Tejas N Patel, Navin D Patel

Founded in 1999 by Navin Patel in the name of Tejas Fabrics with 100...

Paolo Ocleppo
Sandvik Hyperion

Paolo Ocleppo, Rotary Cutting Segment manager, Sandvik Hyperion discusses...

Kai Poehler
Voith Paper GmbH & Co. KG

The glass mat industry is growing by five to eight per cent annually. Kai...

Kevin Nelson
TissueGen

Kevin Nelson, Chief Scientific Officer, TissueGen discusses the growing...

Sidharth Sinha
Sidharth Sinha

<b>Sidharth Sinha</b> has contributed to the successful rebirth and...

Wendell Rodricks
Wendell Rodricks

"We should not compare India and the West. There are things we do that...

Madhu Jain
Madhu Jain

She grew up in the walled city of Old Delhi, completed her studies, and...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


April 2018

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

news category


Related Categories:

Planning to Take the Leap towards
Sustainability?

Do you see sustainability as a route to business growth?

Yes No

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes No

Active Poll

Do you see sustainability as a route to business growth?

Yes
69.9%
No
12.6%
Skip
17.5%

Total Votes: 103

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes No

Active Poll

Do you think the sustainability space has the needed tools and resources available for a business to lead change?

Yes
63.1%
No
29.1%
Skip
7.8%

Total Votes: 103

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes No

Active Poll

Do you think adopting a sustainable approach will be a profitable move for your business?

Yes
87.4%
No
8.7%
Skip
3.9%

Total Votes: 103

Thanks for your valuable feedback. Claim your free latest sustainability e-book.

Active Poll

Do you want the world to know about your sustainability journey and your business’ environmental footprint?

Yes
82.5%
No
7.8%
Skip
9.7%

Total Votes: 103


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search