Owens Corning is seeking a buyer for its vinyl siding extrusion facility in Atlanta, the result of an eight-month review of its entire business.
The company also is selling its metal siding business and, at least temporarily, is exiting the vinyl fencing, decking and railing business.
The Toledo, Ohio-based building products company does not plan to sell its entire vinyl siding business, officials said, countering some industry speculation.
``Our goal is to sell [the Atlanta facility] to someone who will continue to operate it and hire both management and employees who are there,'' said Stephen Krull, vice president of corporate communications. ``We are currently in negotiations with a potential industry buyer. They're interested in purchasing the plant as a turnkey facility to produce vinyl siding.''
The facility employs 134, with seven extrusion lines in 225,000 square feet of office, manufacturing and warehouse space. Krull would not identify the potential buyer, but said Owens Corning hopes to finalize negotiations soon.
The plant originally was owned by Fabwel Inc., which Owens Corning acquired in 1997 as part of Fibreboard Corp. The Atlanta site is Owens Corning's least-profitable and least-utilized facility, Krull said. Earlier this year Owens Corning stopped serving the lagging manufactured-housing market, which placed a burden on that plant.
The plant had been producing Owens Corning-brand siding, sold through independent distributors. The company's new strategy is to place Vytec, Homeside, Norandex and Reynolds siding under the Owens Corning umbrella. Vytec siding will be sold through independent distributors.
``We have developed a new sales organization specifically to support the Vytec brand and look for Vytec to provide continued growth and stability in the [independent distribution] channel,'' Siding Solutions President Dan Dietzel wrote in a Nov. 20 letter to customers.
Homeside siding will be sold through wholesale distributors, which sell to lumberyards and home centers.
Krull said the company will not hold rigidly to those distribution channels and has to maintain flexibility. Still, managing channel conflict is a continuing challenge for a company of Owens Corning's size, Krull said.
``We're aware that channel conflict exists,'' he said. ``We're sensitive to it and we think we do a good job of managing those issues.''
The announcements outline the future of the newly formed Siding Solutions business under Chief Executive Officer Dave Brown, who filled Glen Hiner's post after Hiner's retirement earlier this year. In July, the firm combined metals and vinyl with its Norandex/Reynolds distribution business.
Owens Corning filed for protection from creditors under Chapter 11 of the U.S. Bankruptcy Code in 2000, but Krull said creditors are not forcing the changes.
``We would be making these decisions whether or not we were in bankruptcy,'' he said.
Separately, Owens Corning completely has exited the business of vinyl fencing, decking and railing, less than one year after launching those product lines. Owens Corning did not extrude those lineals, officials said.
``We broke our businesses into different segments, and we looked at everything, and nothing was considered off-base in that review,'' Krull said. ``It was not strategic for us going forward. We're not saying it might not potentially be a good market for others to participate in; it's just not strategic for Owens Corning.''
Industry sources said Owens Corning still plans to be a player in the growing market, potentially introducing lineals in the near future made from alternative plastic materials. But Krull said, ``I know of no plans for that at this time.''
In a 2002 Plastics News ranking, Owens Corning had an estimated $336 million in profile sales. It now operates extrusion facilities in Claremont, N.C.; London, Ontario; Joplin, Mo.; and Olive Branch, Miss.
