Continuing a divestment strategy begun in October, Wellman Inc. has sold its European PET resin business as well as a small specialty fiber business it operated in the United States.
Wellman, a PET resin and fiber manufacturer based in Shrewsbury, N.J., did not disclose terms for either transaction.
``We are getting out of all of our smaller businesses and concentrating on our chemical-based fiber and PET resin businesses in the United States,'' investor relations manager Michael Bermish said in a June 5 telephone interview.
In 2006, Wellman's chemical businesses accounted for $1.05 billion, or 79 percent, of its $1.33 billion in sales.
The firm announced the sale June 1 of its European PET operations, based in Arnhem, Netherlands, to an affiliate of Sun European Partners LLP of London. The European PET operations have 110 million pounds of capacity and 69 employees. Sun European advises Sun Capital Partners Inc., a Boca Raton, Fla.-based private equity company, regarding investments in Europe.
Sun expects to boost the acquired Wellman business' share in food and beverage containers, as well as specialty packaging, said Ruud Enter, general manager of PET resins for Sun.
The other transaction, announced May 29, included a license for the use of the Wellstrand brand name, along with equipment for making coarse polyester staple fiber used in cleaning products like Brillo pads. The buyer is David C. Poole Co. Inc., a distributor of synthetic staple fibers in Greenville, S.C.
Poole said it has resumed manufacturing of the fiber in Johnsonville, S.C., where Wellman had made the product.
Wellman is the largest U.S. PET resin producer, with 1.5 billion pounds of capacity, but has not made a profit since 2001. The company lost $126.8 million in 2006 and $26.9 million in the first quarter of 2007, after cumulative losses of nearly $170 million from 2003-05.
Bermish said Wellman still expects to sell its European fibers business, its U.S. engineering resins operations and its shuttered material recycling plant in Johnsonville, which has capacity to reprocess 150 million pounds of PET annually. The firm hopes to complete those deals in the next 10-16 months, Bermish said.
``We will take those proceeds and use them to pay down debt,'' he said.
Wellman's employees number roughly 1,500, compared with 2,600 in 2000.