This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
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!

OM To Sell Part Of Business For At Least $325M

CLEVELAND (AP) â¿¿ Specialty chemicals maker OM Group Inc. said late Monday that it reached a deal to sell the downstream portion of its advanced materials business to a new joint venture for at least $325 million.

The deal includes an initial cash payment of $325 million and potential future payments of up to an additional $110 million, if the business meets certain targets over the next three years. The joint venture is expected to include Freeport-McMoRan Copper & Gold Inc., Lundin Mining Corp. and La Generale des Carrieres et des Mines.

Investors approved of the move and OM Group shares jumped 11 percent in Tuesday morning trading.

The sale, which remains subject to regulatory approval, is expected to close before the end of April.

OM Group said that the sale, which includes its cobalt refinery assets in Finland, is the final step in exiting its legacy commodity businesses and is in line with its strategy to shift toward technology-based businesses with attractive growth prospects and more predictable profits.

After the sale closes, the Cleveland-based company said it expects to have total cash on-hand of over $500 million, which it will use to repay a substantial part of its debt and buyback up to $50 million of its shares.

In connection with the sale, OM Group said that its board approved the repurchase of up to $50 million of the company's common stock. Based on Friday's closing stock price, the authorization represents about 7 percent of the company's current outstanding shares.

OM Group also warned Monday that market conditions became tougher-than-expected throughout the fourth quarter, especially in Europe and in global consumer electronics markets, and that those conditions continued into 2013.

As a result, the company said it's putting into place a wide variety of cost cuts designed to boost its near-term financial performance and better position the company for when economic conditions begin to improve.

1 of 2

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!

Markets

DOW 17,898.51 +93.71 0.53%
S&P 500 2,073.53 +2.88 0.14%
NASDAQ 4,778.7390 +13.3590 0.28%

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