Poly looks to reduce redundant capacity with six plant closures.
July 16, 2013
by Canadian Packaging Staff
CLEVELAND—PolyOne Corporation, a leading global provider of specialized polymer materials, services and solutions, has announced it will realign its North American manufacturing assets to better serve customers, improve efficiency and deliver previously announced synergy-related cost savings in connection with its March 2013 acquisition of Spartech Corporation.
Headquartered in Clayton, MO, after the acquisition Spartech Corporation became rebranded as PolyOne Designed Structures and Solutions, LLC. It is a leading producer of engineered thermo plastic sheet, polymeric compounds, and engineered products.
Over the next several months, PolyOne will will close six manufacturing plants and relocate production to other PolyOne facilities by the end of 2014 where it is expected to generate annualized pre-tax savings of approximately $25 million in 2015. Cash costs are expected to approximate $45 million over the next 12-18 months, primarily related to severance, asset relocation and additional capital investment.
“These actions are entirely consistent with our previously announced plans to integrate PolyOne and Spartech and to accelerate our specialty transformation,” says PolyOne president and chief executive officer Stephen D. Newlin. “By combining our resources, we expect to better serve our customers with a more competitive cost structure, improved product quality and on-time delivery with increasingly innovative technologies.”
Production at the closing North American facilities will be shifted to other PolyOne locations, and these actions are expected to result in a net reduction of approximately 250 employees.
“Our exceptional management team has the experience and proven track record of transforming and integrating businesses with specialty potential through the execution of our four-pillar strategy,” adds Newlin. “We are committed to delivering at least $65 million of synergies from the Spartech acquisition and $0.50 of EPS accretion upon full synergy capture.
“While the business case for these actions was clear, we understand the impact this announcement will have on affected employees, their families and local communities, and we will handle these moves with great sensitivity and dignity for everyone affected,” he concludes.
PolyOne Corporation, with 2012 revenues of $2.9 billion, is a premier provider of specialized polymer materials, services and solutions. For more information, visit www.polyone.com.