A. Schulman Inc. is wheeling, dealing and cutting.
The Fairlawn company on Tuesday said it will spend $50 million to buy Akron niche plastics maker and distributor Network Polymers Inc. and remains interested in making other deals. Schulman still wants to buy Mayfield Heights specialty chemical maker Ferro Corp.; Schulman so far has been rebuffed with its $850 million offer in cash, stock and debt for the company.
Schulman, a $2.1 billion company that supplies color concentrates, additives and polymer compounds, also announced it will be cutting jobs as part of a restructuring of its Europe, Middle East and Africa regional unit. The cuts are expected to save about $4 million annually. The company did not say where or how many jobs will be affected.
Also, Schulman announced it plans to sell its Brisbane, Australia, rotational compounding business. The unit had about $25 million in revenue in fiscal 2012.
The restructuring and Australia sale were announced in the morning; the pending Network Polymers acquisition was announced after the stock market closed.
“We continue to search for strategic acquisitions in the specialty plastics space, and while we are still interested in entering into a mutual dialogue and due diligence with Ferro Corp., we will continue with our aggressive bolt-on acquisition strategy in our specialty plastics business as well as exploring other opportunities for transformational acquisitions,” said Joseph Gingo, Schulman’s chairman, president and chief executive officer, in a statement. “To date, we have successfully executed five acquisitions and two joint ventures in less than four years. We are ... actively pursuing other targets that align with our value creation strategy.”
Network Polymers provides thermoplastic resins and alloys, including its Diamond Polymer brand thermoplastic products. According to Schulman, Network Polymers had $65.3 million in revenue last year. It employs about 70 people and has a 72,000-square-foot manufacturing plant in Akron.
The Network Polymers deal — Schulman calls it an “agreement in principle” — is expected to close in the next several months.
Shares of A. Schulman on Tuesday rose 41 cents to $29.21. Shares are up 1.7 percent, including dividends, since Jan. 1 and are up 38.3 percent from a year ago.
“Network Polymers is an excellent fit with our ongoing strategy as we continue to enhance our niche engineered plastics business in the U.S.,” Gingo said. Adding the company will give A. Schulman greater penetration in building and construction, agricultural products and lawn and garden markets, he said. It also will expand Schulman’s U.S. distribution business.
Network Polymers CEO and co-founder Alan Woll said his family-owned company and Schulman have complementary products and technologies and similar cultures.
According to the company website, Woll co-founded Network Polymers in 1986. Diamond Polymers was established in 1988 and became a wholly owned subsidiary of Network Polymers in 2002.
Jim Mackinnon can be reached at 330-996-3544 or email@example.com.