Tredegar Corp. is divesting the company's Flexible Packaging Films division to Oben Group in a $116 million deal.
The operations, operating under the Terphane name, includes locations in Bloomfield, N.Y., and Cabo de Santo Agostinho, Brazil, with its headquarters in São Paulo.
Tredegar anticipates clearing $85 million after deduction of withholding taxes, escrow funds, capital gains taxes and transaction costs.
The Terphane business, which makes biaxially oriented PET (BOPET) films, had sales of $152 million and earnings of $16.4 million for the 12 months ended June 30.
Oben CEO Gonzalo Belaunde called Terphane "a relevant producer of BOPET films in Brazil."
"Completion of this transaction will strengthen Oben's position as a global player in the highly competitive flexible films industry, by expanding production capacity of BOPET films and providing a great platform to expand production capacity for other films, especially BOPP (biaxially oriented polypropylene), in the U.S. and Brazil," he said in a statement.
Lima, Peru-based Oben makes PP, polyester and nylon films used for flexible packaging and coated films for the graphic industry. The company also manufactures thermoformed polypropylene products.
The company currently has 14 manufacturing plants, one distribution center and eight sales offices within 17 countries across the Americas and Europe, Oben said. The firm sells into more than 40 countries in the Americas, Europe and Africa.
Tredegar pointed to Oben's size in making the sale.
"We believe that the purchase by Oben of Terphane will enhance the scale and growth opportunities in the keenly competitive global flexible packaging market," Tredegar CEO John Steitz said in a statement.
Tredegar purchased Terphane in 2011 for $188 million from Vision Capital Partners LLP of London.
Terphane started as Rhone-Poulenc Films in 1976 by importing polyester films from France to Brazil, later changing its name to Terphane in 1998. The company first started making film in Brazil in 1979 and purchased the New York plant from Eastman Kodak Co. in 1988.
The Terphane plants will bring about 500 employees to Oben, which currently has more than 2,500 workers.
Oben has the capacity to make 484,000 tons (440,000 metric tons) of films each year. In thermoforming, the company makes PP cups, lids, tubes and containers. Another line of Oben business is the manufacture of engineered resins for the automotive, electrical and construction segments.
News of the film sale comes not long after Tredegar said the company is closing a technical center focused on PE films in Richmond, Va., and reducing activity in the semiconductor films market.
The company's PE Films and Flexible Packaging Films units produced about 28 percent of the company's sales during the second quarter. Aluminum extrusions account for the remaining 72 percent.
Sales and earnings fell during the recently completed quarter in each market segment with Steitz in a statement, blaming "depressed conditions in their markets, which we believe can mostly be traced to the residual impact of the pandemic."
Sale of the Flexible Packaging Films division leaves Tredegar with its PE Films unit that provides surface protection products for electronics markets as well as overwrap and PP films for other markets.
Tredegar indicated there could be a potentially lengthy period, between eight and 14 months, to close the deal.