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In a move to reduce its exposure to the volatility of polyvinyl-chloride resin pricing, Lamson & Sessions agreed to sell substantially all of its PVC pipe business assets and certain liabilities to Eagle Pacific Industries, Inc., in a deal worth $58 million. Lamson & Sessions is getting out of the PVC pipe business to focus on its electrical and cable management products, the company says.
Lamson & Sessions' Carlon unit, which included the PVC pipe business, will continue to manufacture non-rigid pipe, flexible raceway systems for electrical and data, enclosures, surface raceway, switch and outlet boxes and electrical fittings and accessories.
Lamson & Sessions does not intend to sell its remaining business, says Don Gutierrez, corporate vice president for Lamson & Sessions and vice president of Carlon. "These (the remaining electrical and datacom products) are the products that really have been our priority products, either through new product development or through product enhancements," he says.
Lamson & Sessions was forced to sell the PVC pipe business because it was unable to compete with vertically integrated rivals. Eagle Pacific, in a separate transaction, agreed to acquire a polyvinyl-chloride resin plant from Condea Vista Co., a unit of RWE-DEA AG of Germany. Vertically integrating the PVC pipe business will help Lamson & Sessions, which becomes a minority shareholder in Eagle Pacific.
Lamson & Sessions' pipe business represents about 40% of its $272 million in 1997 sales. Eagle Pacific had sales of $71.7 million in 1997.