Skip to main content
Sister Publication Links
  • Sustainable Plastics
  • Plastics News China
  • Rubber & Plastics News
logo-pn-color
Subscribe
  • Login
  • Register
  • Subscribe
  • News
    • Processor News
    • Suppliers
    • More News
    • End Markets
    • FYI Charts
    • LSR World
    • Multimedia
    • NPE2021
    • K Show
    • ENGEL Sponsored Content
    • Special Reports
    • Top materials of injection molders
      Recycled PET use by product category
      US PET, flexible packaging desintations
      Global fluropolymers additives market: CAGR
    • Exhibitors back NPE cancellation: ‘We couldn't take that risk'
      NPE2021 canceled as in-person event
      NPE reviews its options as pandemic prompts exhibitor to exit
      Machine builders meet pressing needs for plastic in 2020
    • Sponsored By ENGEL Machinery
      Tailored maintenance for injection molding machines and robots
      Sponsored By ENGEL Machinery
      Improve maintenance efficiency with e-connect.monitor
      Sponsored By ENGEL Machinery
      Maximum precision for lowest shot weights
      Sponsored By ENGEL Machinery
      Even more cost effectiveness for small precision parts
    • Injection Molding
    • Blow Molding
    • Film & Sheet
    • Pipe/Profile/Tubing
    • Rotomolding
    • Thermoforming
    • Recycling
    • Machinery
    • Materials
    • Molds/Tooling
    • Product news
    • Design
    • What Keeps You Up At Night
    • Mergers & Acquisitions
    • Sustainability
    • Public Policy
    • Material Insights Videos
    • Numbers that Matter
    • Polymer Points Live
    • Automotive
    • Packaging
    • Medical
    • Consumer Products
    • Construction
    • Videos
    • Galleries
    • Podcasts
    • CEO Issue
    • Best Places to Work
    • Processor of the Year
    • Rising Stars
    • Women Breaking the Mold
  • Opinion
    • The Plastics Blog
    • Kickstart
    • Heavy Metal
    • One Good Resin
    • BRICS and Plastics
    • All Things Data
    • Viewpoint
    • Perspective
    • Mailbag
    • Watching, and hoping, for progress in 2021
      COVID-19 stories dominate 2020 headlines
      Plastic Globes ask: Was there a lighter side in 2020?
      Compounders write a business survival story in 2020
    • Kickstart: Another push to reduce plastic packaging
      Kickstart: People bought a lot of refrigerators in 2020
      Kickstart: RVs gain ground as 'tailor-made' social distance vacation option
      Kickstart: Building a foam platform
    • Heavy Metal: Coronavirus edition, plus the work of working from home
      Don't put off succession planning
      What's a good gift for your cobot? Batteries?
      Here's some big ideas to mull over the holidays
    • Chase expands giving campaign in 2020
      McDivitt will showcase Ascend's COVID-19 work on CNBC's Mad Money
      Move over, Plastic Man: Here comes Plastic Woman
      Star in spotlight with West Virginia philanthropy award
    • The business case for producer responsibility
      Think divided government stalls plastics legislation? Think again
      ACC, NAM eye economic priorities in Biden presidency
      As scrap exports drop, will plastics recycling rate fall?
    • Just how big is thermoforming in North America?
      Changing names for compounders embracing corporate branding
      Diversity the key to outperforming the market
      A timeline of the industry's COVID response
    • Watching, and hoping, for progress in 2021
      The business case for producer responsibility
      Compounders write a business survival story in 2020
      Think divided government stalls plastics legislation? Think again
    • Plastics industry business owners: Listen to your future workforce
      Perspective: ‘Fake news' of a different sort?
      Perspective: Making products in the USA is good for the planet
      Perspective: Reflections on a decade of global industry collaboration on marine litter
    • Modernizing recycling infrastructure will benefit businesses as well as the environment
      Mailbag: Oil-plastics connection is overstated
      Mailbag: Plastics recycling not cost-effective
      Mailbag: Price increases hurting North American PE buyers
  • Shop Floor
    • Blending
    • Compounding
    • Drying
    • Injection Molding
    • Purging
    • Robotics
    • Size Reduction
    • Structural Foam
    • Tooling
    • Training
    • Maintenance can ensure efficient blender operation
      Dosing: Perfect for adding color
      Blending vs dosing: What you need to know
      Going low or high: Comparing volume
    • Colors and custom compounds
      In the laboratory: Compounding solutions
      Recycling content: Resins going ‘green’
      Compounding: Glass and other fillers
    • Dryer maintenance: Don’t err with air
      Dryers: Options for a shop’s process
      Dryer installation: Going central?
      Resins: Hygroscopic or non-hygroscopic
    • Electric injection molding presses: Efficiency is key
      Hydraulic injection molding machines
      Proper maintenance can prevent downtime
      Hybrid injection molding machines
    • Purging Hot runners: Open or closed methods
      Purging extrusion machinery
      Purging extrusion blow molding machines
      Purging: Chemical, abrasive and non-abrasive
    • Controls, special applications boost production, profitability
      Robot maintenance key for smooth operation
      High-speed robots: A rapid way to increase efficiency
      Robots: Every shape and size
    • Maintenance: Key for efficiency
      Shredders: Plastic in pieces
      Safety first for size reduction
      Granulators: The right fit
    • Structural foam molding: Flexibility for processors
      Video: Structural foam molding
    • Mold inventory: How many molds does a shop have?
      Molds: Innovation
      Mold changeover: Saving time and money
      How molds work
    • Labor: Apprenticeships may provide answer
      College training, programs
      Internships: Solving the skills gap in-house
      Lean Six Sigma: Transforming business operation
  • Events
    • Plastics News Events
    • Industry Events
    • Livestreams/Webinars
    • Ask the Expert
    • Polymer Points Live
    • Reifenhäuser Technologies Livestreams
    • 2020 Caps & Closures Library
    • Plastics in Healthcare Library
    • Women Breaking the Mold Networking Forum Library
    • Polymer Points Live - July 2020
      Polymer Points Live - October 2020
      Polymer Points Live - August 2020
      Polymer Points Live - December 2020
    • Plastics in Healthcare 2020
    • Plastics News Executive Forum
    • Plastics in Automotive
    • Plastics News Caps & Closures
    • Plastics in Healthcare
    • Women Breaking the Mold Networking Forum
  • Resin Prices
    • All Resins
    • Commodity TPs
    • High Temp TPs
    • ETPs
    • Thermosets
    • Recycled Plastics
    • Historic Commodity Thermoplastics
    • Historic High Temp Thermoplastics
    • Historic Engineering Thermoplastics
    • Historic Thermosets
    • Historic Recycled Plastics
  • Rankings
    • Injection Molders
    • Blow Molders
    • Film Sheet
    • Thermoformers
    • Pipe Profile Tubing
    • Rotomolders
    • Mold/Toolmakers
    • LSR Processors
    • Recyclers
    • Compounders - List
    • Association - List
    • Plastic Lumber - List
    • All
  • Data Store
  • Directory
  • More+
    • Classifieds
    • Digital Edition
    • Newsletters
    • Sponsored Content
    • Processor of the Year submissions
    • White Papers
    • Sponsored By Mitsubishi
      Innovative new technology from Mitsubishi Engineering-Plastics Corporation helps reduce emission footprints
      Canon Virginia, Inc.
      Sponsored Content By Canon Virginia, Inc.
      Canon Virginia Inc. brings collaboration to the table
      Sponsored By CDS MACHINES
      Facing medical equipment shortages during COVID-19 outbreak?
      Sponsored Content By Canon Virginia, Inc.
      Transform your molding capabilities with the Canon Shuttle Mold System
    • Sponsored By Conexiom
      Use Sales Order Automation to free up time for CSRs to focus on customers, not manual entry
    • Place an Ad
    • Sign up for Early Classified
MENU
Breadcrumb
  1. Home
  2. News
November 05, 2012 01:00 AM

PolyOne and Spartech executives discuss plans for combined company

  • Tweet
  • Share
  • Share
  • Email
  • More
    Print

    CHICAGO (Nov. 5, 12:15 p.m. ET) — PolyOne Corp.'s $393 million purchase of Spartech Corp., which marks the compounding powerhouse's move into manufacturing, has become one of the most talked-about deals of the season.

    Vicki Holt, president and CEO of Spartech, and Julie McAlindon, vice president of corporate marketing for PolyOne, gave Plastics News more details on the acquisition in an interview Oct. 29 at PackExpo 2012 in Chicago.

     “There's a lot of opportunity with the technology that Spartech has and the technology that PolyOne offers,” McAlindon said. “We're really excited about the innovation opportunity.”

    With the acquisition, PolyOne will move into manufacturing areas. Spartech's sheet and film divisions — its custom sheet/roll stock and packaging technologies units — will become part of PolyOne's specialty business segment, Holt said.

    Spartech will do business as PolyOne, but the company's brands, like its PreservaPak barrier packaging, will retain their names, Holt said.

    Custom sheet and roll stock are new technologies for PolyOne, but they're adjacent to what the company already does. “We do a lot of the same things. We pull from the same palette of materials,” but Spartech sells its products in a sheet form rather than a pellet form, Holt said

    The two companies have other similarities. For the last few years, Spartech has been on a journey to become a more-specialized, less-commodity-type business. The acquisition will only accelerate that, Holt said.

    PolyOne has been undergoing a similar transformation into a specialty business since 2006, and “with the experience that we've gained, the processes and best practices that we've put into place, we think we can double their speed,” McAlindon said.

    “I think the combination is one of those classic ‘one plus one equals three' combinations,” Holt said.

    The two companies also have a similar approach to their customers — both focus on delivering what the client wants in full and on-time, according to Holt.

    PolyOne's experience in materials science, combined with Spartech's manufacturing capabilities, will give the company a “bigger toolbox of solutions we can use to help [customers] tackle their next packaging challenge,” McAlindon said.

    The acquisition will also help PolyOne break into new markets. The company will focus on markets where Spartech is already a strong player, especially those where becoming a more-specialized business will lead to more opportunities for growth, McAlindon said.

    There are also areas where PolyOne is focused, like transportation, health care, building and construction, where bringing in Spartech could drive more growth, she said.

    And there are markets the companies could handle more efficiently with their combined offerings and contacts, Holt added. For example, PolyOne is strong in health care, and Spartech in aerospace.

    The acquisition will also benefit Spartech customers that want to expand globally. Spartech is primarily based in North America (the company does have a small compounding plant in France), but PolyOne has locations worldwide. Often, when companies expand outside of North America, they want to have a valued suppler that can follow them. Now Spartech will be able to offer that, Holt said.

    The majority of its business may be in sheet and roll stock, but Spartech also has a compounding business, an area where there could be some overlap.

    PolyOne won't make any decisions about Spartech's compounding operations, or where there are opportunities to streamline, until after the deal closes, probably early in the first quarter of 2013, McAlindon said. Many synergies will come from business process improvements like expanding margins and making processes more efficient, she said.

    Because both companies are publicly traded there are obviously going to be overlaps. For example, a company only needs one board and one set of public officers, Holt said. The majority of Spartech doesn't overlap with PolyOne, however, so the company will need those people and facilities to continue improving and growing, McAlindon added.

     Holt did not say if she would stay with the newly combined company. “Right now, I'm just focused on keeping the momentum that we've got … and getting us through a close and a transition, and we'll see what happens after that. I'm keeping very focused on the here and now,” she said.

    Combined, the two companies will have around 90 plants and more than 7,500 employees worldwide, McAlindon. Together, they companies will have combined sales of $4.3 billion, she said. By 2015, the company plans to have sales of more than $5 billion.

    Meeting that goal will require a combination of both organic growth and mergers and acquisitions activity, she said. PolyOne is “absolutely” still looking for deals — it has a strong balance sheet and the financial flexibility to find good opportunities and take them as they arrive, she said. The company's strategy is to continue to build its specialty platform. By 2015, PolyOne plans to have 65-75 percent of its operating income from from specialty sales, up from 50 percent right now, she said. While Spartech will certainly help with that, PolyOne wants to continue to build up on that, she added.

    While one law firm — Tripp Levy PLLC of New York — said it was investigating the deal to see if the purchase price was too low, Holt said the deal will bring Spartech shareholder's “tremendous value.”

    Shareholders will receive value through three key areas: a significant premium on the current stock price; a deal that is two-thirds stock, allowing Spartech stockholders to share in the value of the transaction; and accelerated earning improvement at a lower-risk profile, she said.

    Not only can PolyOne help Spar­tech improve, there's opportunity for sustainable growth in the future, according to McAlindon.

    “This is the best opportunity for our shareholders at the right time,” Holt agreed, adding that the acquisition lets Spartech complete its strategic journey faster. “I'm calling it the right deal at the right time,” she said.

    Letter
    to the
    Editor

    Do you have an opinion about this story? Do you have some thoughts you'd like to share with our readers? Plastics News would love to hear from you. Email your letter to Editor at [email protected]

    Get our newsletters

    Staying current is easy with Plastics News delivered straight to your inbox, free of charge.

    Subscribe today

    Subscribe to Plastics News

    Subscribe now
    Connect with Us
    • LinkedIn
    • Facebook
    • Twitter
    • Instagram

    Plastics News covers the business of the global plastics industry. We report news, gather data and deliver timely information that provides our readers with a competitive advantage.

    logo-pn-color
    Contact Us

    1155 Gratiot Avenue
    Detroit MI 48207-2997

    Customer Service:
    877-320-1723

    Resources
    • About
    • Staff
    • Editorial Calendar
    • Media Kit
    • Data Store
    • Digital Edition
    • Custom Content
    • People
    • Contact
    • Careers
    • Sitemap
    Related Crain Publications
    • Sustainable Plastics
    • Rubber & Plastics News
    • Urethanes Technology
    • Plastics News China
    • European Rubber Journal
    • Tire Business
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Copyright © 1996-2021. Crain Communications, Inc. All Rights Reserved.
    • News
      • Processor News
        • Injection Molding
        • Blow Molding
        • Film & Sheet
        • Pipe/Profile/Tubing
        • Rotomolding
        • Thermoforming
        • Recycling
      • Suppliers
        • Machinery
        • Materials
        • Molds/Tooling
        • Product news
        • Design
      • More News
        • What Keeps You Up At Night
        • Mergers & Acquisitions
        • Sustainability
        • Public Policy
        • Material Insights Videos
        • Numbers that Matter
        • Polymer Points Live
      • End Markets
        • Automotive
        • Packaging
        • Medical
        • Consumer Products
        • Construction
      • FYI Charts
        • Current FYI
      • LSR World
      • Multimedia
        • Videos
        • Galleries
        • Podcasts
      • NPE2021
      • K Show
      • ENGEL Sponsored Content
      • Special Reports
        • CEO Issue
        • Best Places to Work
        • Processor of the Year
        • Rising Stars
        • Women Breaking the Mold
    • Opinion
      • The Plastics Blog
      • Kickstart
      • Heavy Metal
      • One Good Resin
      • BRICS and Plastics
      • All Things Data
      • Viewpoint
      • Perspective
      • Mailbag
    • Shop Floor
      • Blending
      • Compounding
      • Drying
      • Injection Molding
      • Purging
      • Robotics
      • Size Reduction
      • Structural Foam
      • Tooling
      • Training
    • Events
      • Plastics News Events
        • Plastics News Executive Forum
        • Plastics in Automotive
        • Plastics News Caps & Closures
        • Plastics in Healthcare
        • Women Breaking the Mold Networking Forum
      • Industry Events
      • Livestreams/Webinars
      • Ask the Expert
      • Polymer Points Live
      • Reifenhäuser Technologies Livestreams
      • 2020 Caps & Closures Library
      • Plastics in Healthcare Library
      • Women Breaking the Mold Networking Forum Library
    • Resin Prices
      • All Resins
      • Commodity TPs
        • Historic Commodity Thermoplastics
      • High Temp TPs
        • Historic High Temp Thermoplastics
      • ETPs
        • Historic Engineering Thermoplastics
      • Thermosets
        • Historic Thermosets
      • Recycled Plastics
        • Historic Recycled Plastics
    • Rankings
      • Injection Molders
      • Blow Molders
      • Film Sheet
      • Thermoformers
      • Pipe Profile Tubing
      • Rotomolders
      • Mold/Toolmakers
      • LSR Processors
      • Recyclers
      • Compounders - List
      • Association - List
      • Plastic Lumber - List
      • All
    • Data Store
    • Directory
    • More+
      • Classifieds
        • Place an Ad
        • Sign up for Early Classified
      • Digital Edition
      • Newsletters
      • Sponsored Content
      • Processor of the Year submissions
      • White Papers