Divestitures and Assets Held for Sale

6 Months Ended

Jun. 30, 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 $60.5 million, subject to customary adjustments. The Company agreed to provide certain transition services related to finance, human resources and information technology ("IT") that ended during the second quarter of 2021, resulting in final cash proceeds of $64.1 million. 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 and six months ended June 30, 2021 and 2020:


	Three Months Ended June 30,				Six Months Ended June 30,
(In thousands)	2021		2020		2021		2020
Revenues and other items:
Sales	$	—	$	32,378	$	—	$	68,544
Other income (expense), net	—		(180)		—		(261)
	—		32,198		—		68,283
Costs and expenses:
Cost of goods sold	—		27,785		—		57,927
Freight	—		1,570		—		3,275
Selling, general and administrative	169		4,022		1,219		7,147
Research and development	—		2,628		—		5,313
Asset impairments and costs associated with exit and disposal activities, net of adjustments	—		126		—		526
Adjustment to the fair value estimates used in the disposal of Personal Care Films(a)	(819)		—		(1,118)		—
Total	(650)		36,131		101		74,188
Income (loss) from discontinued operations before income taxes	650		(3,933)		(101)		(5,905)
Income tax expense (benefit)	142		(797)		(22)		(1,111)
Income (loss) from discontinued operations, net of tax	$	508	$	(3,136)	$	(79)	$	(4,794)
(a) Represents a net increase to the estimated fair value of Personal Care Films primarily due to lower costs associated with IT transition-related services to provide the seller developed assets, which did not exist at the time of the sale, to support the seller's IT infrastructure.

The assets and liabilities of the discontinued operations reflected in the consolidated balance sheets as of June 30, 2021 and December 31, 2020, respectively, were as follows:


	June 30,		December 31,
(In thousands)	2021		2020
Assets
Prepaid expenses and other (a)	$	151	$	1,339
Other non-current assets	151		151
Total assets of discontinued operations	$	302	$	1,490

Liabilities
Accrued expenses (a)	$	1,033	$	7,521
(a) The consolidated balance sheet of discontinued operations as of June 30, 2021 includes $0.2 million of other receivables related to the settlement of customary post-closing adjustments, accrued severance of $0.6 million, and other miscellaneous accrued expenses of $0.4 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:


	Six Months Ended June 30,
(In thousands)	2021		2020
Operating activities
Depreciation and amortization	$	—	$	4,394
Asset impairment	—		334
Other	(1,118)		—
Total	(1,118)		4,728
Investing activities
Capital expenditures	$	—	$	(1,482)

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. During the third quarter of 2020, the held for sale criteria was met since the Company expected 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.