Citation
(2003), "Eastman to restructure or divest parts of units supplying coatings and related markets", Pigment & Resin Technology, Vol. 32 No. 6. https://doi.org/10.1108/prt.2003.12932fab.026
Publisher
:Emerald Group Publishing Limited
Copyright © 2003, MCB UP Limited
Eastman to restructure or divest parts of units supplying coatings and related markets
Eastman to restructure or divest parts of units supplying coatings and related markets
Eastman Chemical Co. have announced plans to pursue "strategic alternatives" in an effort to improve the profitability of its coatings, adhesives, specialty polymers and inks (CASPI) segment. The company said that it will consider restructuring, divestiture and consolidation moves involving businesses and product lines in the segment that are "performing below acceptable financial levels in their current structure".
The company said that the businesses and product lines to be targeted for restructuring or divestiture include acrylate ester monomers; composites (unsaturated polyester resins); ink and graphic-arts raw materials; liquid resins; powder resins; and textile chemicals. Eastman said that it has retained the investment-banking firm J.P. Morgan to assist in evaluating the strategic alternatives.
"The businesses and product lines within the CASPI segment that we are focusing on are not meeting the company's expectations for profitability under their current structure", said Brian Ferguson, Eastman Chairman and CEO. "We will be making decisions and taking actions on the strategic alternatives of restructuring, divesting and consolidation in an aggressive manner". Ferguson said the moves are already under way and will be taken in stages, with completion of the program anticipated within the next 8-12 months. The business targeted employ approximately 2,400 people. The company said that the businesses being targeted had 2002 sales of approximately $650 million while recording an operating loss of approximately $75 million. For 2003, the company is forecasting a higher operating loss for the businesses and product lines. The businesses were acquired in the late 1990s and early 2000s.
Ferguson said that the strategic moves would not affect Eastman's supply capabilities in the markets involved, saying the company remains "committed to meeting their needs as we take these actions. We expect to improve our overall performance in the markets in which we compete both on a product and a service level, and we will be working on an individual basis with customers to ensure that this happens".