Cytec closing three plants, shutting down China JV

By Frank Esposito
Senior Staff Reporter

Published: July 17, 2013 3:44 pm ET
Updated: July 17, 2013 4:29 pm ET

Related to this story

Topics Mergers & Acquisitions, Composites

Composites maker Cytec Industries Inc. is taking several actions related to last year's purchase of Umeco plc.

Woodland Park, N.J.-based Cytec is closing three former Umeco plants in California, shutting down a Chinese joint venture and is selling off a Umeco distribution unit.

The three California plants being closed are in Costa Mesa, Adelanto and Huntington Beach. About 120 jobs will be eliminated as a result of the closings, Cytec officials said in a July 15 news release. Work done at those plants will be moved to Cytec sites in Winona, Minn., and Tulsa, Okla.

Closing the plants and transferring equipment will cost Cytec about $27 million, officials said.

The California sites are expected to be closed by mid-2015. The affected plants made films and similar products based on epoxies, phenolics and other thermosets for aerospace and related industries. The move is expected to save Cytec between $3 million and $4 milllion annually.

Umeco's Process Materials joint venture in China will be liquidated. The JV served the Chinese wind market, which has struggled. The closure will result in a second-quarter pretax charge of $3.3 million for Cytec. Umeco formed the JV in 2010 along with partner Shanghai Leadgo Technology Co. Ltd. Umeco had invested about $4 million in the JV, which operated a plant in Shanghai making vacuum-bagging films.

The Umeco distribution products unit has been sold to private equity firm Cathay Investments for $8.6 million. The business distributes polyester, vinyl ester, acrylic and phenolic resins, as well as premium gel coats and low-profile additive products, for Ashland Inc. and other supply partners worldwide. The unit posted sales of about $20 million in the first five months of 2013, Cytec officials said in the release.

Cytec will take a second-quarter pretax loss of $12.5 million on the sale.

Cytec paid almost $440 million for Umeco, a British firm founded in 1917. The deal — announced in April 2012 — is expected to increase Cytec's annual sales by more than $300 million.

In 2012, Cytec's sales rose 20 percent to more than $1.7 billion, but the firm's profit fell 9 percent to less than $200 million.


Comments

Cytec closing three plants, shutting down China JV

By Frank Esposito
Senior Staff Reporter

Published: July 17, 2013 3:44 pm ET
Updated: July 17, 2013 4:29 pm ET

Post Your Comments


Back to story


More stories

Image

China's biggest fuel tank maker getting a US foothold

April 23, 2014 4:41 pm ET

The majority owner of China's biggest fuel tank maker is expanding its global automotive footprint with the acquisition of the fuel tank unit of...    More

Image

How CEO Santi is changing ITW

April 23, 2014 2:48 pm ET

Scott Santi is showing he can do more than just cut costs at Illinois Tool Works Inc.    More

Quality Vision buys ShapeGrabber

April 23, 2014 10:19 am ET

Quality Vision International Inc. of Rochester, N.Y., has purchased ShapeGrabber Inc., a maker of automated three-dimensional scanners, in a deal...    More

Image

Pregis Corp. to get new owner

April 22, 2014 11:44 am ET

The private equity owner of Pregis Corp. is selling off its North American operations for an undisclosed sum.    More

PolyQuest spins off FiberQuest unit

April 18, 2014 10:14 am ET

PolyQuest Inc. has spun off its FiberQuest unit — which distributes polyester staple fibers and cotton — as a separate company.    More

Market Reports

Market Data Book - Rankings & Lists

A one-stop download of Plastic News' exclusive annual lists and processor rankings containing essential data including sales, employees, end markets, materials and more.
EXCLUSIVE EXCEL FEATURE: full mailing address details for available plant locations.

Learn more

Thermoformed Packaging 2014 Market Review & Outlook North America

This in-depth report provides analysis and discussions of economic and political conditions, market trends, legislative/regulatory activity impacting supply and demand, business opportunities and threats, materials pricing, manufacturing technology, as well as strategies being implemented by thermoformed packaging companies. In addition, there are reviews of 25 leading thermoformers in the packaging segment, assessing their growth initiatives and performance metrics over 10 years.

Learn more

Mold Making and Tooling Review and Outlook 2014 North America

This report provides in-depth analysis of the mold and toolmaking market for North America, including discussions of trends, opportunities, threats, the latest developments in production and labor and equipment trends impacting moldmakers.

Learn more

Upcoming Plastics News Events

May 6, 2014 - May 8, 2014Plastics in Medical Devices 2014

May 12, 2014 - May 12, 2014Plastics News Brazil Pharma Summit

September 10, 2014 - September 12, 2014Plastics Caps & Closures 2014

February 3, 2015 - February 7, 2015Plastics News Executive Forum 2015

More Events