This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Cytec Announces Agreement To Sell Building Block Chemicals Business

Cytec Industries Inc. (NYSE:CYT) announced today it has reached a definitive agreement to sell its Building Block Chemicals business, with 2010 sales of $600 million, to an affiliate of HIG Capital, LLC. Total consideration to be received of $180 million includes cash consideration of $165 million at closing and a Note for $15 million. The sale is subject to customary closing conditions.

Shane Fleming, Chairman, President and Chief Executive Officer commented, “This transaction, when completed, will allow us to put more attention and resources on our core growth platforms of Engineered Materials, In Process Separations and Waterborne and Radcure Coating Resins, focusing on organic growth and possible bolt-on acquisitions.

“With an outstanding performance in 2010, it is an appropriate time to divest the business. I want to thank the Building Block Chemical employees for their perseverance in the challenging times and for creating a viable, dynamic business for the future.”

The Building Block Chemicals product lines include acrylonitrile, sulfuric acid and melamine which are produced mostly for third party sale. In the case of acrylonitrile and melamine, a portion of the production is for internal use with acrylonitrile used in the manufacture of carbon fiber and melamine used in the manufacture of certain coating resins. All products are manufactured at its world-scale, highly integrated facility located in Fortier, Louisiana.

Included in the transaction are the sales, marketing, manufacturing, R&D and technical service personnel and the aforementioned manufacturing site located in Fortier, Louisiana. At closing, the companies will also execute long term supply agreements for acrylonitrile and melamine at market pricing. The purchaser has agreed to offer employment to the approximately 445 employees who are involved in the operations of this business.

Excluding the impact of the anticipated gain on this transaction and the loss of operating earnings related to the divestiture of Building Block Chemicals, the transaction is expected to reduce Cytec continuing earnings in 2011 by approximately $0.15 per diluted share. This is mostly attributable to the impact of the new supply agreements at market pricing for melamine and acrylonitrile and assumes current high market prices throughout 2011. Historically, market pricing for melamine and acrylonitrile varies widely. The company’s policy is to transfer products between its operating segments at cost versus market pricing, which includes intersegment sales by Building Block Chemicals. Continuing costs related to Corporate Services are mostly offset by savings from the recently launched Shared Services initiative which is expected to be completed by mid-2011.

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,039.49 +60.36 0.36%
S&P 500 1,992.37 +5.86 0.30%
NASDAQ 4,532.1040 +5.6220 0.12%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs