St. Louis, July 14--The European subsidiary of bankrupt chemicals concern Solutia Inc. has tapped an investment banking firm to help explore the possible sale of its pharmaceutical services business.
In a filing Monday with the Securities and Exchange Commission, Solutia Inc., St. Louis, said Solutia Europe SA has hired Rothschild Inc. to explore "strategic options," including the possible sale, of the drug-related operation.
Solutia Europe's pharmaceutical services business accounts for about $50 million, or roughly 2%, of its corporate parent's yearly revenue, Solutia spokesman Dan Jenkins said Tuesday.
Solutia said that while the possible sale of the business would include businesses conducted by two Swiss subsidiaries of Solutia Europe, "there is no assurance that any such sale would occur."
Solutia filed for Chapter 11 bankruptcy protection in December. Since then, a federal bankruptcy judge in New York has given Solutia two extensions in filing how it expects to return to profitability.
The company was to have filed such a plan Wednesday, though an extension granted in recent weeks pushed that deadline until mid-October, Jenkins said.
Such extensions are common in complex bankruptcy matters.
In filing for bankruptcy, Solutia cited heavy financial obligations assigned to it when it was spun off by Monsanto Co. (MON) as a separate company in 1997. Since then, Solutia was on the hook for retiree benefits, environmental and litigation costs accrued by Monsanto and Pharmacia over a century of manufacturing.
In 1999, Monsanto, St. Louis, was acquired by Pharmacia & Upjohn to create Pharmacia Corp., which in 2002 completed a spin-off of its biotechnology and agricultural businesses to form the current Monsanto. Pharmacia was acquired by Pfizer Inc. (PFE) in April 2003.
Monsanto has said it wouldn't take on any obligations that aren't its legal responsibility during the bankruptcy process, barring a court order.
Solutia makes nylon products, films for laminated safety glass and aftermarket, water-treatment chemicals, heat-transfer fluids and aviation hydraulic fluid.
