Divestitures and Assets Held for Sale

3 Months Ended

Mar. 31, 2021

Mergers, Acquisitions and Dispositions Disclosures

Divestitures

Personal Care Films

In 2020, the Company completed the sale of Personal Care Films for an aggregate purchase price of approximately $60.5 million, subject to customary adjustments. The Company agreed to provide certain transition services related to finance, human resources and information technology which are expected to end in the first half of 2021. Personal Care Films was previously reported in the PE Films segment.

The following table summarizes the financial results of discontinued operations reflected in the consolidated statements of income for the three months ended March 31, 2021 and 2020:


	Three Months Ended March 31,
		2021		2020
Revenues and other items:
Sales		$	—	$	36,166
Other income (expense), net		—		(81)
		—		36,085
Costs and expenses:
Cost of goods sold		—		30,142
Freight		—		1,705
Selling, general and administrative		1,050		3,125
Research and development		—		2,685
Asset impairments and costs associated with exit and disposal activities, net of adjustments		—		400
Adjustment to the fair value estimates used in the disposal of Personal Care Films(a)		(299)		—
Total		751		38,057
Income (loss) from discontinued operations before income taxes		(751)		(1,972)
Income tax expense (benefit)		(164)		(314)
Income (loss) from discontinued operations, net of tax		$	(587)	$	(1,658)
(a) Represents a net increase to the estimated fair value of Personal Care Films primarily due to lower costs associated with transition-related services.

The assets and liabilities of the discontinued operations reflected in the consolidated balance sheets as of March 31, 2021 and December 31, 2020, respectively were as follows:


	March 31,		December 31,
	2021		2020
Assets
Prepaid expenses and other (b)	$	3,285	$	1,339
Other non-current assets	151		151
Total assets of discontinued operations	$	3,436	$	1,490

Liabilities (a)
Accrued expenses (b)	$	6,438	$	7,521
(a) Pension and other postretirement benefit liabilities related to Personal Care Films have been retained by the Company. (b) The consolidated balance sheet of discontinued operations as of March 31, 2021 includes $0.4 million of other receivables related to the settlement of customary post-closing adjustments, deferred assets of $2.9 million and deferred obligations of $4.6 million related to transition services, accrued severance of $1.3 million, and other miscellaneous accrued expenses of $0.5 million. The consolidated balance sheet of discontinued operations as of December 31, 2020 includes $0.4 million of other receivables related to the settlement of customary post-closing adjustments, deferred assets of $0.9 million and deferred obligations of $5.3 million related to transition services, accrued severance of $2.1 million, and other miscellaneous accrued expenses of $0.2 million.

The following table provides significant operating and investing cash flow information for discontinued operations:


	Three Months Ended March 31,
(In thousands)	2021		2020
Operating activities
Depreciation and amortization	$	—	$	2,231
Asset impairment	—		271
Other	(299)		—
Total	(299)		2,502
Investing activities
Capital expenditures	$	—	$	(795)

Assets Held For Sale

In July 2019, the Company committed to a plan to close its manufacturing facility in Lake Zurich, Illinois, which historically was reported by the Company within the Personal Care Films component of its PE Films segment. In 2020, the held for sale criteria was met since the Company expects the sale of the facility to be completed within one year. The disposal group carrying value of $4.6 million consists of land, building, and building improvements and is reported in "Prepaid expenses and other" in the consolidated balance sheet. These assets were not included as part of the sale of Personal Care Films.