Exxon Chemical Co. wants to exit the flexible packaging market. The Irving, Texas, chemical and energy giant said it plans to sell its 36-year-old films business based in Buffalo Grove, Ill.
Exxon spokeswoman Janis Grant said her company believes the business has a better future with another film company. The film industry is consolidating and markets are strong, making it an opportune time to sell the unit, she said in a telephone interview.
Exxon operates plants in Lake Zurich, Ill., and Pottsville, Pa., making cast and blown polyethylene and polypropylene films mainly for consumer disposables, hygiene and medical packaging. It recorded film sales of about $125 million last year and processed about 110 million pounds of resin. The film operations employ about 350.
Grant did not disclose any details on capacity and machinery.
Grant said Exxon's two film plants essentially are interchangeable in their product mix. The firm wants to sell both as an ongoing business. It hired Chase Securities Inc. of New York to help it find a buyer.
Chase Vice President Gary Denning said the process ``is going well,'' but he would comment no further. Several potential buyers researched by reporters declined to comment on their interest or did not return telephone calls.
``There's always a list of buyers and consolidators,'' noted George Staphos, a packaging analyst with Solomon Smith Barney in New York.
He added that it could be a tough time to sell because film profits are probably low.
Exxon announced internally Sept. 25 the decision to sell. Word gradually leaked out about the decision as far away as the K'98 show in Dusseldorf, Germany. Grant said the films business is profitable.
The market for personal-care films has been consolidating recently, with two major deals involving Salt Lake City-based Huntsman Packaging Corp.
Huntsman Packaging bought CT Films in September 1997, and followed that up by purchasing Blessings Corp. in May. Tredegar Film Products of Richmond, Va., is another leading player in the personal-care films business.
Both Huntsman Packaging and Tredegar Film officials declined comment on Exxon's planned sale.