Discontinued Operations

3 Months Ended

Feb. 29, 2012

Discontinued Operations [Abstract]

Discontinued Operations

Note B – Discontinued Operations

As part of the Company's strategy to focus on businesses with greater global growth potential, the Company committed to divesting its commercial wallcovering businesses in the fourth quarter of 2011.

On December 12, 2011, the Company completed the sale of its North American wallcovering business to J. Josephson, Inc., a private commercial wallcovering producer based in New Jersey. The sale included print cylinders, certain equipment, trademarks, contracts and other assets associated with the Company's domestically-produced wallcovering. Under terms of the sale, the Company received $10.0 million in cash and may receive up to three years of royalty payments based on future sales of OMNOVA commercial wallcovering patterns. The Company retained the net working capital, the Columbus, Mississippi manufacturing facility and certain production assets, which are also used by its other businesses.

The Company recognized a net after-tax gain of approximately $6.0 million ($9.9 million before tax) from the sale transaction during the first quarter of 2012, which represents the excess of the sale price over the book value of the assets sold.

The Company will continue to manufacture commercial wallcovering products for J. Josephson as part of an orderly transition of production from the Company's Columbus, Mississippi plant to J. Josephson's plant in New Jersey. The Company expects the transition period will be less than one year, however it can extend up to 15 months. The net cash flows expected to be received and paid by the Company relating to the manufacture of commercial wallcovering for J. Josephson during the transition period are not expected to be significant.

For the North American wallcovering business, the Company allocated the book value of certain shared manufacturing assets, as well as the associated shared manufacturing and selling costs between the wallcovering products and the coated fabrics products based on the relative shares of manufacturing volume produced in the Columbus, Mississippi facility. The Company will transition the manufacturing of certain coated fabrics products to other company facilities within the next 9 to 12 months.

On March 6, 2012, the Company sold its U.K.-based Muraspec commercial wallcovering business to affiliates of a2e Venture Catalysts Limited and its principal Amin Amir for $2.7 million in cash and a note receivable for $3.8 million. The sale price is subject to a working capital adjustment which the Company estimates will be a reduction in the purchase price of approximately $0.3 million due to lower levels of working capital on the transaction date. The Company recognized losses of $.9 million related to this transaction in the first quarter of 2012 to reflect the fair value of the assets and liabilities to be sold to the buyer.

With the Company's decision to exit the commercial wallcovering business, the results of operations and cash flows from these businesses have been classified as discontinued operations for all periods presented.

Held For Sale Classification

As a result of the decision to exit the Company's European commercial wallcovering business, the assets and liabilities of the Muraspec commercial wallcovering business have been sold as of the date previously stated and were reflected as assets and liabilities held for sale and are comprised of the following:

	February 29,		November 30,
(in Millions)	2012		2011
Cash	$	3.4	$	2.8
Accounts receivable		6.5		7.1
Inventories, net		3.7		4.0
Other current assets		.2		2.7
Assets Held For Sale – Current	$	13.8	$	16.6
Property, plant and equipment, net	$	—	$	—
Deferred income taxes		.1		—
Assets Held For Sale – Non-Current	$	.1	$	—
Accounts payable	$	1.5	$	6.6
Accrued payroll and personal property tax		1.2		1.1
Other current liabilities		3.5		.8
Liabilities Held For Sale – Current	$	6.2	$	8.5
Non-Current Tax Liability	$	.2	$	—

Unless otherwise noted, the following discussions of the results of operations of the Company and its segments exclude the discontinued businesses.