ADM (ADM) Sees One Time Pre-Tax Charge of $300-$360M Following Termination of Commercial Alliance with Metabolix (MBLX)
Tweet
Share
E-mailGet Alerts ADM Hot Sheet
Up)Join SI Premium – FREE
Archer Daniels Midland Company (NYSE: ADM) announced today that ADM Polymer Corporation, a wholly owned subsidiary of ADM, will end its commercial alliance with Metabolix, Inc. (Nasdaq: MBLX) on February 8, 2012.
As a result of this decision, Telles LLC, the sales and marketing commercial alliance created to commercialize Mirel™, a biobased plastic, will be dissolved, and Mirel production on behalf of Telles will end. Under the terms of their commercial alliance, ADM Polymer Corporation may provide PHA fermentation services for Metabolix during a three-year period following termination.
As a result of the change in circumstances and its decision to terminate the commercial alliance, ADM is evaluating other commercially viable uses for the fermentation assets in Clinton, but has not yet made any firm decision on alternative uses. As a result, ADM will record a one-time pretax charge in its second quarter of between $300 million and $360 million, primarily for impairment of the related production assets. ADM anticipates the cash portion of the total charge to be less than $5 million.
As a result of this decision, Telles LLC, the sales and marketing commercial alliance created to commercialize Mirel™, a biobased plastic, will be dissolved, and Mirel production on behalf of Telles will end. Under the terms of their commercial alliance, ADM Polymer Corporation may provide PHA fermentation services for Metabolix during a three-year period following termination.
As a result of the change in circumstances and its decision to terminate the commercial alliance, ADM is evaluating other commercially viable uses for the fermentation assets in Clinton, but has not yet made any firm decision on alternative uses. As a result, ADM will record a one-time pretax charge in its second quarter of between $300 million and $360 million, primarily for impairment of the related production assets. ADM anticipates the cash portion of the total charge to be less than $5 million.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Equifax (EFX) shares tumble on weak Q1 revenue, guidance miss
- Cyngn Inc (CYN) CEO Issues Business Update
- Vicinity Motor (VEV) Appoints Brent Phillips as President
Create E-mail Alert Related Categories
Corporate NewsSign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!
