The leader of Crown Cork & Seal Co. Inc. said the company expects an upswing in its PET bottle business, as he sidestepped talk about the sale of part of its unit.
The Philadelphia firm began selling some of its underperforming assets last fall to raise cash and reduce debt from asbestos liability. Since then, rumors have circulated that its Constar PET blow molding business would be sold.
Packaging companies Ball Corp. and then Rexam plc were said to be interested in that sprawling division, but they backed away because of the asbestos issues, according to several sources familiar with the negotiations.
Speaking March 26 at Packaging Strategies 2002 in Orlando, John Conway, Crown Cork chairman, president and chief executive officer, said the company's PET business had a disappointing 2001, as did many competitors.
``It was a little spotty in terms of performance,'' Conway said. ``We had some difficulty generating consistent cash flow. But we think our PET business is in the beginning of a sustainable upswing this year.''
The firm will introduce new technologies, including a cost-efficient oxygen barrier, to its PET bottles in 2002 to drive up value, Conway said. The company also expects to see more conversion from metal to PET containers.
Conway, who took over leadership of Crown Cork in June 2001, also said the company has made each division responsible for its own results, Conway said.
The company will continue evaluating its assets while pursuing long-term growth opportunities, he said. Crown Cork plans to spend $45 million to $50 million annually in research and development to foster innovative products, Conway said.
Crown Cork recorded $7.2 billion in sales for 2002. About 20 percent of its products are made from rigid plastic, with the rest in metal containers, Conway said.
``We're in a good position and we'll continue to do more,'' Conway said. ``I see no reason to bet against us at this point. We'll come out of [the economic downturn] just fine.''