Solutia Considering Sale of Nylon Business

St. Louis, MO, June 30, 2008--Solutia Inc. said it has retained HSBC Securities  Inc. to explore strategic alternatives regarding its nylon business, including a possible sale.

"We have transformed our nylon business from a North American-focused fiber business into the world's second-largest producer of nylon 66 plastics," said Jeffry N. Quinn, chairman, president and chiefexecutive officer of Solutia Inc.

"The nylon business is on a path for further growth and improvement in financial performance, and we believe strongly in the strategic course we have set for thebusiness. However, given the strength of our high-margin specialty chemical and performance materials businesses and the current industry dynamic in the nylon segment, it is an appropriate time to explore strategic alternatives available with respect to the nylon business that would better position both the nylon business and the rest of Solutia for reaching their ultimate potential."

In 2007, the nylon business generated net sales of $1.89 billion, or approximately 51percent of Solutia's total revenue, and adjusted earnings before interest, taxes and depreciation of $106 million, or 28 percent of Solutia's total.

In 2008, first quarter net sales for the nylon business were $468 million, an increase of 10 percent compared to a year ago. However, the business' adjusted EBITDA was a loss of $7million for the quarter, a decrease of $35 million over last year, largely due to higher raw material costs that were only partially recovered with higher selling prices in the quarter.

Solutia's nylon business is one of only two world wide businesses that own the complete range of technology to produce nylon 66. The business is able to efficiently serve global markets from its integrated set of world-scale, flexible assets located in North America. During 2007, 28 percent of the business' sales came from Asia.

With its 2008 addition of 68,000 metric tons of capacity for Vydyne and Ascend nylon 66 resins and polymers, that percentage is expected to rise further, driven by rapidly growing demand among Asian producers of automotive, electrical, and consumer goods.