Myers Industries has announced that it has completed the sale of its Brazilian operating subsidiaries, consisting of Myers do Brasil and Novel Plasticos, to Novel Holdings – Eireli for $1.
Myers Industries will retain no assets or liabilities associated with the Brazilian entities. In connection with the sale, Myers expects to record a pre-tax loss of approximately $35 million during the fourth quarter of 2017, primarily related to the write-down of assets and other transaction-related costs.
The company said it also expects to realize a cash tax benefit of approximately $15 million as a result of the write-off of the company’s investment in Brazil.
“We are pleased to have reached this agreement, as this strategic transaction will allow us to better focus energy and resources on targeted niche markets where we see opportunities for stronger growth and value creation for the Company,” said Dave Banyard, president and chief executive officer. “Our exit from Brazil should improve our future cash flow generation, and we are also pleased that the transaction will provide additional value in the form of a meaningful tax benefit.”
The Brazilian operations design and manufacture reusable plastic shipping containers, plastic pallets, crates and totes used for closed-loop shipping and storage in Brazil’s automotive, distribution, food, beverage, and agriculture industries. The combined Brazilian entities had revenue of approximately $24 million in 2016.