WILMINGTON, DEL. -- The Du Pont Co. last week announced the completion of the sale of its high-density polyethylene business and related U.S. facilities to Cain Chemical Inc. for $510 million.
About $375 million of that money will be used for general corporate purposes and to reduce high-cost debt, Du Pont said. The sale will result in an after-tax gain of about $100 million.
The sale and accompanying debt reduction will mean a benefit of about 25 cents a share for shareholders in the second quarter, the company said.
The deal, affecting only Du Pont's U.S. operations, was announced April 30.
Based in Houston, Cain Chemical is a petrochemical company that was formed by the Sterling Group, an investment banking firm that specializes in leveraged buyouts.
With the purchase, Cain Chemical becomes the sixth-largest U.S. ethylene producer. More than 600 Du Pont personnel are becoming employes of Cain Chemical.
The sale includes Du Pont's 450-million-pound-per-year high density polyethylene plant at Matagorda, Texas, and its HDPE production units at Orange and Victoria, Texas, which have a combined capacity of 450 million pounds per year.
Cain Chemical has also acquired Du Pont's olefins and aromatics complex near Alvin, Texas, and the HDPE semiworks at Ponca City, Okla.