Privately held Linpac Plastics Ltd. of Knottingley, England, has agreed to purchase Viskase Corp.'s PVC film business, including the Filmco brand name.
Neither company would disclose terms of the deal.
The nonbinding letter of intent involves the acquisition of the assets used in Viskase's 75,000-square-foot Aurora, Ohio, plant and the 94,000-square-foot Sedgefield, England, plant. The agreement represents a divestiture of a noncore business, said Gordon Donovan, spokesman for Envirodyne Industries Inc., Viskase's parent company.
Viskase had announced its intent to jettison its PVC films business earlier this year. Each plant employs about 100 people. Company officials would not reveal the number of lines at each plant. Filmco supplies film for grocery wrap and food packaging. In Sedgefield, the firm also converts oriented polypropylene films for packaging bakery goods.
Viskase's specialty film and casings businesses are not included in the sale. The films include biaxially OPP and single-and multilayer heat-shrinkable plastic bags for packaging and preserving fresh and processed meat, poultry and cheese products. Cellulosic casings are used to prepare and package processed meat products.
``The proposed acquisition is the latest development in a global strategy which we embarked upon some time ago,'' Michael Anderson, managing director of Linpac Plastics, said in a news release. ``It is our intention to expand still further by both acquisitions and organic growth in the manufacture of PVC and other plastics films, as well as a variety of packaging for fresh, chilled and frozen foods.''
The company intends to promote the Filmco brand and grow the market for PVC film produced at the Aurora and Sedgefield plants.
This move will link those operations with Linpac's PVC film plants in Pontivy, France, and Cape Town, South Africa.
The Aurora plant will work in conjunction with Linpac's Wilson, N.C., and Sebring, Fla., plants, which make expanded polystyrene foam trays for meat and produce. In addition, the Aurora plant will export part of its production to Central and South America.
Until Linpac begins production of PVC film in South America, film from Aurora will be distributed there together with EPS food packaging products made at its new operations in Santiago, Chile; Montevideo, Uruguay; and SÃo Paulo, Brazil.
Linpac Plastics' main end markets are in packaging of fresh, chilled and frozen foods and packaging for the fast-food industry, which includes EPS meat and produce trays, hot-food boxes and egg cartons.
The company also makes clear oriented PS food containers, PVC stretch films, agricultural films and other types of flexible packaging.
The firm operates its own crystal PS polymer plant and a recycling plant in the United Kingdom.
Linpac also manufactures, but does not market, insulation materials for the building industry in the United States.
The purchase is subject to a number of contingencies, including the completion of due diligence, receipt of any necessary governmental approvals and execution of a definitive purchase agreement.
Within 90 days, the deal should be finalized.
Envirodyne is a $650 million holding company that operates through wholly owned subsidiaries. It runs more than 20 plants with 4,900 employees worldwide. Other subsidiaries are Sandusky Plastics Inc. and Clear Shield National Inc., which make disposable plastic cutlery, drinking straws, custom dining kits and thermoformed plastic containers for dairy and deli products.
Linpac Plastics has operations throughout Europe, South America and the United States. It had sales of about $420 million last year.
It is one of four divisions of Linpac Group of Louth, England.
Plastics News' British correspondent Richard Higgs contributed to this story.