NEW YORK (AP) - Archer Daniels Midland Co. said Thursday it is ending a biodegradable plastics joint venture with Metabolix Inc. because of the venture's cost, and uncertainty about its returns.
The companies said the joint venture, which is called Telles, will be dissolved on Feb. 8. Telles makes plastics from corn sugar that biodegrade in natural soil and water and in home or industrial composting systems. The FDA has approved Mirel plastics for use in plastic utensils and lids. Archer Daniels Midland announced on Wednesday that it plans to eliminate 1,000 jobs, and it said Thursday that it was not clear how much business Mirel would get.
"Uncertainty around projected capital and production costs, combined with the rate of market adoption, led to projected financial returns for ADM that are too uncertain," said Mark Bemis, the president of Archer Daniels Midland's corn business. The companies created the joint venture in July 2006.
The news sent shares of Metabolix plunging $2.68, or 45 percent, to $3.31 in aftermarket trading following the announcement.
Metabolix, which is based in Cambridge, Mass., said it is disappointed with the decision and will consider new plans to commercialize the Mirel and Mvera bioplastics. The company said it will regain ownership of all the technology used in the joint venture, and Archer Daniels Midland will retain ownership of the manufacturing facility in Iowa that has been making the Mirel resins.
Archer Daniels Midland, of Decatur, Ill., said it will take a one-time pretax charge of $300 million to $360 million in the second quarter as a result of its decision. It said the cash portion of the charge should be less than $5 million.
Archer Daniels Midland stock gained 21 cents to $29.14 during the day and picked up another 4 cents to $29.18 aftermarket.
Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
SATO is a pioneer and leading global provider of integrated Automatic Identification and Data Collection solutions that leverage barcode and RFID technologies. SATO manufactures innovative, reliable auto-identification systems and offers complete...
more
ECONOCORP, INC. is a leading worldwide manufacturer of ECONOSEAL cartoning, trayforming, and casepacking caters to moderate volume users and features simplicity in design, operation, and maintenance. ECONOSEALS handle paperboard and corrugated...
more
QuickLabel Systems makes and sells digital color label printers and barcode label printers for use by manufacturers of foods, beverages, pharmaceuticals, chemicals, and more...
more
Bosch Packaging Technology, Inc. is one of the world's leading suppliers of packaging machinery. Our diverse portfolio of packaging machines, including the well known Doboy brand, includes robotic automation with pick & place robots (delta robots)...
more
Hitachi America Ltd., Industrial Components & Equipment Division, supplies a broad range of industrial products and services. The division supplies sophisticated industrial equipment, components and services for application in pharmaceutical...
more
Markem-Imaje is a trusted world manufacturer of product identification and traceability solutions, offering a full line of reliable and innovative inkjet, thermal transfer, laser, print and apply label systems and RFID-based systems. Markem-Imaje...
more
Fogg is a world leader in the design and manufacture of rotary filling, rinsing, capping and enclosure systems for free flowing and viscous liquids. Fogg serves a growing number of dairy, spirits, water, food and beverage, pharmaceutical and...
more
Markem-Imaje is a trusted world manufacturer of product identification and traceability solutions, offering a full line of reliable and innovative inkjet, thermal transfer, laser, print and apply label systems and RFID-based systems. Markem-Imaje...
more
Microscan develops barcode and machine vision products that help manufacturers reduce costs, increase yields, improve product quality, and comply with regulations. Designed for precision applications, Microscan's line of 1D and 2D barcode readers...
more
Thermo Scientific Product Inspection and Processing equipment protects your brands by ensuring the quality, accuracy, efficiency and safety of your products. With more than 50 years of making sure little things don't turn into big problems, we know...
more
DOMINO is one of the world's largest manufacturers of digital printing solutions and is publicly traded on the London Stock Exchange. Our products are used for date coding, product marking, serialization and variable printing. Among our customers...
more
Teledyne DALSA is a world leader in the design, manufacture and deployment of digital imaging components for the machine vision market. Teledyne DALSA image sensors, cameras, smart cameras, frame grabbers, software and vision solutions are used in...
more
VIEW ALL GALLERIES
