Earlier this year, Apollo, along with Graham Partners, paid $2.25 billion for plastics packaging giant Berry Plastics Corp. (Evansville, IN). Apollo also owns Hexion Specialty Chemicals Inc. (Columbus, OH), a $4.5 billion supplier of adhesive, structural, and coating thermoset resins made up of Borden Chemical, Bakelite AG, Resolution Performance Products, and Resolution Specialty Materials. Apollo took Hexion public in June of this year.
Apollo didn''t detail its plans for Advanced Materials, but will retain Wayne Hewett as president and CEO of the business, which will be renamed when the deal is finalized. Numerous press reports have hinted that GE is considering a sale of its plastics unit, which along with many other material firms has watched it profits shrink in the face of rising raw material costs in the form of oil and gas. On August 23, GE named Lloyd Trotter as head of its $35 billion industrial business, which includes plastics and formerly advanced materials, which was slated for 15% earnings growth in 2006. Trotter was also named a vice chairman at GE. In a second quarter earnings report, Keith Sherin, GE''s senior VP, CFO, reported that "plastics had a tougher quarter", with revenue up 3%, volume up 10%, but profits down 12%, saying the company would be "watching the plastics dynamics."