Myers Industries Inc. of Akron, Ohio, will divest its European operations, which include its Raaco business in Nykobing Falster, Denmark, and its Allibert-Buckhorn Ltd. subsidiary in Prunay-sur-Essonne, France.
Officials said in a July 27 conference call announcing second-quarter results that the businesses no longer fit Myers' long-term plan.
The operations include six manufacturing facilities, with the majority of equipment in winding extrusion and injection molding.
``We said we might be getting smaller before we get larger,'' President and Chief Executive Officer John Orr said during the call.
``Our continued focus on strategic customers and markets, pricing adjustments to manage raw material costs, improving productivity, and controlling costs is paying off,'' he said.
Raaco, which Myers acquired in 1998, has one facility in Denmark where it produces plastic bins, toolboxes and small-parts storage systems. Myers acquired Allibert-Buckhorn in 1999 when it was Allibert Equipement. That unit has five facilities in France, Spain and the United Kingdom, where it manufactures reusable plastic containers, pallets and bulk storage tanks.
The company will invest the savings in its distribution operation and in paying down $236 million in debt. Officials said distribution is a great growth area with the potential for bolt-on acquisitions.
The firm's materials-handling business in North America is targeted for growth, as well as its lawn and garden and automotive and custom segments.
The firm reported sales of $238.2 million for the quarter, up from $225 million for the same period one year ago. Still, because of its goodwill impairment charge of $109.8 million related to the divesting, the company recorded a loss of $100 million for the quarter.
Myers stock rose $1.33 by the close of business July 27, trading at $16.84 per share on the New York Stock Exchange.