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Wellman selling resins division |
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Tuesday, 30 September 2008 |
SCBIZ Daily Staff
JOHNSONVILLE -- Wellman Inc. Saturday announced it has entered into a letter of intent to sell its Engineering Resins business and other assets located on its Johnsonville site to an investor group that specializes in turnarounds and renewable energy businesses and is known for its commitments to long-term investing.
The sale would save roughly 160 jobs at the company’s Johnsonville plant.
“This is a fantastic opportunity for our Engineering Resins business, our employees, customers and the surrounding community. With the financial backing and commitment of our new partners, we expect to have the resources to expand our Engineering Resins operation and restart the PET bottle recycling operation,” said Robert Taylor, vice president of Engineering Resins. “It is also a great feeling to work with this investor group to save jobs at the Johnsonville site.”
As part of its bankruptcy reorganization plan, Wellman announced it was consolidating its operations at a Pearl River, Miss., facility and shuttering its Fort Mills headquarters and its plant in Florence and Johnsonville, idling a total of 750 workers.
Terms of the transaction were not disclosed, but the deal is expected to close shortly after the completion of a definitive agreement and due diligence, and after the receipt of bankruptcy court approval, the company said.
The investor group, which includes JHW Greentree Capital, an affiliate of J.H. Whitney & Co., GarMark Partners and Westwind Equity Partners, has made a commitment to recycled PET through their investment in New Horizon Plastics Recycling, which is one of the largest producers of recycled PET serving the bottling and other industries.
“The sale needs to proceed with urgency and is scheduled to close in the middle of October. During the sale process, Wellman expects to continue to service its customers,” said Mark Ruday, Wellman’s CEO. “Wellman believes the sale would benefit the approximately 160 Johnsonville employees as well as the town of Johnsonville, its school system and its water treatment facility.”
Robert Fotsch, CEO of New Horizons, who would also become CEO of the Wellman-Johnsonville assets, said New Horizons plans to make the necessary investments to re-establish Johnsonville’s leadership in both Engineering Resins and recycled PET so that it remains a critical partner to companies in the automotive, bottling and other industries.
“Given the high cost of oil, the products produced at Wellman’s Johnsonville’s facility are a very attractive alternative to high priced virgin plastics,” Fotsch said.
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