Solo Cup Co. said it has signed an agreement to sell off its Japanese subsidiaries, Yugen Kaisha Solo Cup Asia-Pacific and Solo Cup Japan Co. Ltd., to Yugen Kaisha PC Rose, an affiliate of Japanese investment fund Phoenix Capital Co. Ltd.
Solo is selling all of the subsidiaries' capital stock for about $48 million, with the deal set to close Nov. 12.
The two subsidiaries employ about 190. They were acquired by Solo in 2001.
``We've taken a different strategy, a more distribution-focused strategy,'' said Angie Chaplin, communications director at Solo Cup.
The buyer will acquire all property, plant and equipment, including Solo Cup Japan's manufacturing facilities in Fuji and Kumamoto, Japan, as well as a corporate office in Tokyo.
Solo Cup Japan primarily makes drinking straws and caps for milk bottles.
``Our production in Japan is narrow in scope and not well-aligned with our core disposable food-service business,'' said Robert Korzenski, chief executive officer of Solo Cup, in a news release.
He added that Solo intends to use the proceeds to reduce the firm's term loan, which will bring its total debt reduction for the year to more than $370 million.
Solo Cup Co. is a $2.2 billion company focused on the manufacture of disposable food-service products for the consumer and retail, food-service and international markets. The company makes paper, plastic and foam disposables and creates brand-name products under the Solo and Sweetheart brand names. Solo has facilities in Canada, Europe, Mexico, Panama and the U.S.
Last week, the company said it was closing plants in Wheeling, Ill., and Leominster, Mass., and transferring the work to Chicago and North Andover, Mass.