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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) December 22, 1998
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THE GEON COMPANY
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(Exact name of registrant as specified in charter)
Delaware 1-11804 34-1730488
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
One Geon Center, Avon Lake, Ohio 44012
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 440-930-1001
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Not Applicable
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(Former name or former address, if changed since last report.)
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Item 5. Other Events
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The Geon Company (NYSE: GON) announced that it has signed a definitive
agreement with Occidental Chemical Corporation (OxyChem), a subsidiary of
Occidental Petroleum Corporation (NYSE: OXY), to implement their proposed joint
ventures and to transfer certain businesses to Geon.
Item 7(c). Financial Statements, Pro Forma Financial Information and Exhibits
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Exhibit 99.1 Press Release of December 22, 1998 announcing the signing of a
definitive agreement with Occidental Chemical Corporation to form joint venture.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
THE GEON COMPANY
By \s\ Gregory L. Rutman
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Secretary
Dated December 23, 1998
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EXHIBIT 99.1
GEON, OXYCHEM SIGN DEFINITIVE AGREEMENT TO FORM JOINT VENTURE
Cleveland, Ohio - December 22, 1998 -- The Geon Company (NYSE: GON) today
announced that it has signed a definitive agreement with Occidental Chemical
Corporation (OxyChem), a subsidiary of Occidental Petroleum Corporation (NYSE:
OXY), to implement their proposed joint ventures and to transfer certain
businesses to Geon. Also today, Geon's Board of Directors approved the
transactions.
The two companies previously announced that they had signed a letter of intent
to create a polyvinyl chloride (PVC) resin and vinyl chloride monomer (VCM)
joint venture owned 24 percent by Geon and 76 percent by OxyChem. The joint
venture, which will be known as Oxy Vinyls, LP (Oxy Vinyls), will combine Geon's
PVC mass/suspension resin and VCM assets with OxyChem's PVC mass/suspension
resin and VCM assets and related chlor-alkali facilities. This joint venture
would have had 1997 revenues exceeding $1.2 billion.
The definitive agreement specifies that Geon will acquire OxyChem's PVC
compounding and film businesses in Burlington, New Jersey, and OxyChem's pellet
compounding business in Pasadena, Texas. The agreement also creates a second
joint venture owned 90 percent by Geon, involving OxyChem's new powder
compounding plant in Pasadena and Geon's powder compounding plant in Plaquemine,
Louisiana. This joint venture will be devoted solely to powder or dry-blend
compounds.
The next steps in formation of the joint ventures are approval by Geon
shareholders, approval by the Board of Directors of Occidental Petroleum
Corporation as well as completion of review by government regulatory agencies.
Geon anticipates receiving all necessary approvals and closing the transactions
by the end of the first quarter of 1999.
"This is an important strategic step in our transformation of The Geon Company
into a business based on performance polymers and services," said William F.
Patient, chairman and chief executive officer. "We will have the structure and
added financial strength to pursue growth strategies for our value-added
businesses, compounding and specialty resins, which are the core of the `new'
Geon. With a history of earnings growth, these businesses will deliver enhanced
near- and long-term shareholder value," Patient added.
Geon will contribute to the resin joint venture its five suspension/mass PVC
resin plants, its VCM plant, ethylene contracts, chlorine supply contracts from
its joint venture with Olin Corporation and its contracts for hydrogen chloride
with Bayer Corporation and Dow Chemical.
OxyChem will contribute its PVC resin plant, its VCM plant, its ownership
interest in the OxyMar VCM joint venture, its Houston chlor-alkali complex, two
co-generation facilities and certain rights and obligations under an OxyChem
ethylene supply contract.
Geon and the Oxy Vinyls joint venture have agreed to enter into long-term resin
and VCM supply agreements for Geon's compounding and specialty resin operations.
The Oxy Vinyls joint venture has targeted $80 million in annual cost savings,
including energy, logistics, product line consolidation and purchasing. That
amount represents savings of about $0.02 per pound of PVC produced by the joint
venture company.
Geon will realize $110 million through the retention of current assets and
receipt of cash from Oxy Vinyls. The Oxy Vinyls joint venture will assume
approximately $185 million in lease
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obligations from Geon. The acquisition of OxyChem's compounding and film
businesses is expected to contribute nearly $200 million to Geon's annual
revenues, which will total approximately $1.2 billion in 1999.
The Geon Company is a leading North American-based polymer technology and
service company with operations in PVC compounds and other value-added products
and services, as well as in PVC resins. Headquartered in Avon Lake, Ohio, The
Geon Company and its subsidiaries currently employ more than 2,400 people and
have 24 manufacturing plants in the United States, Canada, England and
Australia, and joint ventures in the United States, Europe, Australia and
Southeast Asia. Geon recorded revenues of $1.25 billion for the year ended
December 31, 1997. Information on the Company's products and services, as well
as news releases, EDGAR filings, Form 10-K, 10-Q, etc. are available on the
Internet at http://www.geon.com.
