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Eastman Cancels IPO, Adopts Divisional Structure
WILLIAM STORCK
Eastman Chemical has made it official: It has cancelled its planned split of the company and the attendant initial public offering (IPO) of its Voridian commodity chemicals unit. Instead, the company will adopt a divisional structure reflecting the original split, but keeping the units within the one firm.
The original plan, as announced a year ago (C&EN, Feb. 12, 2001, page 8), would have split the company in two: Eastman Co., retaining specialty chemicals and plastics, with annual sales of about $3 billion; and Voridian, which would have had about $2 billion in sales from commodity products--polyethylene terephthalate, acrylic fibers, and polyethylene. In November, the company postponed the spin-off, citing adverse market conditions and the uncertainty of the business outlook.
"The intent of the spin-off," says Eastman CEO J. Brian Ferguson, "was to separate our businesses so that each could set its own course for growth, resource allocation, and strategies. The work we did internally last year has allowed us to set up a divisional structure that does just that without splitting into two publicly traded companies."
He says the structure allows a focus on low-cost production in the Voridian division and a concentration on developing new products and services in the rest of the company.
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