Spartech bought by Ohio company

NEW YORK -- Chemical company PolyOne Corp. reported Wednesday an 11 percent increase in its third-quarter net income and disclosed it has agreed to buy plastics products maker Spartech Corp. for $246 million in stock and cash.

Spartech employs about 230 people at its two Cape Girardeau facilities, one on Spartech Drive near Arena Park and a second on Nash Road.

PolyOne makes resins used in plastic pipe and other products, and said the earnings increase reflected an improved product mix.

The deal would give PolyOne a "leading market position in sheet, rigid barrier packaging and specialty cast acrylics," according to PolyOne Chairman and CEO Stephen D. Newlin.

"We believe this is a very compelling transaction for our shareholders, customers and employees," Newlin said.

Vicki Holt, president and CEO of Spartech, based in St. Louis, noted in a statement that PolyOne and Spartech have "complementary growth strategies" and by combining resources, it expects to make advances in innovation and market access.

Under the terms of the deal, Spartech stockholders will receive $2.67 in cash and 0.3167 shares of PolyOne common stock for each share of Spartech common stock.

Based on the closing price of PolyOne shares Tuesday, Spartech stockholders will receive cash and stock valued at $8 per Spartech common share, a 56 percent premium over Spartech's closing price of $5.14 per share Tuesday.

The deal also includes the assumption of Spartech's net debt of $142 million.

In its earnings report, Cleveland-based PolyOne said that it earned $24 million, or 27 cents per share, in the three-month period that ended Sept. 30. That compares with $21.6 million, or 23 cents per share, in the year-ago period.

Excluding unusual items, the company said its adjusted earnings came to 33 cents per share. That topped analysts' forecasts for earnings of 31 cents per share, according to FactSet.

Revenue rose to $740.2 million from $735.8 in the year ago period. Analysts expected revenue of $795.3 million.

Both companies' shares rose Wednesday. PolyOne rose $1.52, or 9 percent, to $18.36 per share, while Spartech's shares went up $3.24, or 63 percent, to $8.38.

PolyOne has more than 60 manufacturing and distribution facilities with operations in North America, South America, Europe, Asia and Africa.

Spartech operates in the United States, Mexico, Canada and France producing plastic resins, specialty plastic alloys and color and specialty compounds.

Calls to representatives of Spartech and PolyOne by the Southeast Missourian were not immediately returned.

Pertinent address:

Nash Road, Scott City, MO

Spartech Drive, Cape Girardeau, MO