Film producer Applied Extrusion Technologies Inc. has ended discussions with outside parties to buy the firm, opting instead to remain under current ownership.
In June, AET said it had received several unsolicited expressions of interest in the company and would evaluate options. Since then the company has launched a plan to reduce costs and hike profitability, it announced Sept. 23.
That plan is the better option for the company to move forward, Amin Khoury, chief executive officer and chairman, said in an Oct. 8 news release. The offers to buy AET were not adequate compared with the company's value based on its new management plan, Khoury said.
``We are optimistic about the long-term prospects of the business and look forward to return to profitability in fiscal 2003,'' he said. AET lost $3.84 million for the nine-month period ended June 30.
The company is eliminating about 50 positions. It closed its former headquarters in Peabody, Mass., on Sept. 30, and executives are moving to the films division in New Castle, Del., said spokesman William Swain.
AET expects to save $5 million in restructuring costs from the plan beginning in fiscal 2003, which started Oct. 1.
The company also has renewed focus on technology in oriented polypropylene film, where it has a large share of the North American market.
Several industry sources said Israeli OPP film producer Dor Chemicals Ltd. was a potential suitor for AET and that a financial buyer also might have shown interest. But Dor's parent company, Haifa, Israel-based Dankner Group, is highly leveraged and has debt issues, said several sources following the possible sale.
Reports in Israel now say that Dor could become a subsidiary of Moplefan SpA, a Milan, Italy-based maker of OPP film. Dankner Group recently purchased a majority stake in Moplefan from Basell NV.