February 19, 2013
GLENVIEW, ILL. -- Illinois Tool Works is considering a sale or spinoff of its industrial packaging unit, which includes the firm's Signode, Muller and Mima brands.
The unit makes plastic, steel and paper products and equipment for bundling, shipping and protecting transported items. It had sales of approximately $2.4 billion in 2012, a 2 percent drop from 2011.
The industrial packaging unit makes up 14 percent of total company sales.
ITW said the possible divestiture is part of their ongoing portfolio management initiative. The firm plans to divest commoditizing businesses -- up to 25 percent of ITW's portfolio -- that negatively impact the company's performance, according to a presentation at ITW's 2012 investor meeting.
ITW will instead focus on higher growth markets and a simplified business structure that includes consolidating the firm's approximately 800 businesses.
In 2012, ITW finalized a sale of its decorative surfaces segment to a fund managed by Clayton, Dublier & Rice LLC, and it also sold its Minigrip re-sealable bag business to Inteplast Group Ltd.
ITW, based in Glenview, Ill., had sales of approximately $18 billion in 2012. The manufacturing powerhouse has about 60,000 employees in 52 countries.