Assets and Liabilities Held for Sale

On March 18, 2016, the Company entered into a definitive agreement for the sale of its PAC Business to Synthomer plc (the “Buyer”) for a purchase price of approximately $226. Assets included in the transaction are the Company’s manufacturing sites in Sokolov, Czech Republic; Sant’Albano, Italy; Leuna, Germany; Asua, Spain; Roebuck, South Carolina; and Chonburi, Thailand. The PAC Business produces resins, polymers, monomers and additives that provide enhanced performance for adhesives, sealants, paints, coatings, mortars and cements used primarily in consumer, industrial and building and construction applications.

The PAC Business generated annual sales of approximately $370 in 2015, and is reported within the Epoxy, Phenolic and Coating Resins Division of the Company. The PAC Business had pre-tax income of $5 and $4 for the three months ended March 31, 2016 and 2015, respectively, which is reported as a component of “Loss before income tax and earnings from unconsolidated entities” in the unaudited Condensed Consolidated Statements of Operations.

The sale is subject to customary closing conditions, including Works Council consultation. The transaction is expected to close in the second quarter of 2016. Until the closing date, the Company has agreed to operate the PAC Business in the ordinary course. The Company has also agreed to provide certain transitional services to the Buyer for a limited period of time following the closing.

The assets and liabilities of the PAC Business as of March, 31, 2016 are classified as “Current assets held for sale”, “Long-term assets held for sale”, “Current liabilities associated with assets held for sale” and “Long-term liabilities associated with assets held for sale” in the unaudited Condensed Consolidated Balance Sheets, and consist of the following:



	March 31, 2016
Current assets held for sale:
Cash and cash equivalents	$	1
Accounts receivable (net of allowance for doubtful accounts of $1)	29
Inventories:
Finished and in-process goods	23
Raw materials and supplies	8
Other current assets	6
Total current assets held for sale	$	67

Long-term assets held for sale:
Deferred income taxes	$	2
Other long-term assets	2
Property and equipment:
Land	11
Buildings	48
Machinery and equipment	108
	167
Less accumulated depreciation	(92		)
	75
Other intangible assets, net	1
Total long-term assets held for sale	$	80

Current liabilities associated with assets held for sale:
Accounts payable	$	42
Debt payable within one year	2
Other current liabilities	12
Total current liabilities associated with assets held for sale	$	56

Long-term liabilities associated with assets held for sale:
Long-term debt	$	3
Long-term pension and post employment benefit obligations	2
Other long-term liabilities	5
Total long-term liabilities associated with assets held for sale	$	10