3. DISCONTINUED OPERATIONS AND OTHER DIVESTITURES

Discontinued operations

Coating Resins

On April 3, 2013, we completed the divestiture of our remaining Coating Resins business to Advent International (“Advent”), a global private equity firm, for $1,015.0 plus assumed liabilities of $118.0, bringing the total value to $1,133.0. As a result, we recorded a cumulative after-tax loss on the sale of $16.9 in 2013. These cumulative after-tax losses are included in Net (loss) gain on sale of discontinued operations, net of tax in the consolidated statement of income for 2013. The final price paid and loss on sale remains subject to final working capital and other customary adjustments.

Previously, on July 31, 2012, we completed the sale of the pressure sensitive adhesives (“PSA”) product line of the former Coating Resins segment to Henkel AG & Co. for approximately $105.0, including working capital of approximately $15.0. In 2012, we received cash consideration of $112.8 from the sale and recorded an after-tax gain on the sale of $8.6, which is included in Net (loss) gain on sale of discontinued operations, net of tax in the consolidated statements of income. In 2012, we also recorded cumulative after-tax charges of $24.7 to adjust our carrying value of the Coatings disposal group to its fair value less cost to sell, based on the terms of the definitive agreement with Advent at that time. The charge is included in Net (loss) gain on sale of discontinued operations, net of tax in the consolidated statement of income for 2012.

The results of operations of the former Coating Resins segment have been reported as discontinued operations, and are therefore excluded from both continuing operations and segment results for all periods presented. All previously reported financial information has been revised to conform to the current presentation.

Building Block Chemicals

On February 28, 2011, we completed the sale of substantially all of the assets and certain liabilities of our Building Block Chemicals business (the “Business”) to Cornerstone Chemical Company, an affiliate of HIG Capital, LLC (the “Purchaser”), pursuant to an Asset Purchase Agreement dated January 28, 2011, between the Company and the Purchaser. The total consideration received from the sale was $175.7, including cash consideration of $160.7 that we received at closing and a promissory note for $15.0, due in six years and bearing interest at 7.0% annually. This note was paid in full in the first quarter of 2013. A cash payment of $6.6 was made to the Purchaser in July 2011 as final settlement of the agreed working capital transferred, resulting in net realized consideration of $169.1. The assets sold include our Fortier plant located in Westwego, Louisiana, personal property, inventory, accounts receivable, contract rights and certain other assets that are used in or relate to the Business, all as further specified in the Asset Purchase Agreement. Liabilities assumed by the Purchaser include accounts payable, contract liabilities, and certain environmental and product liabilities, and certain other liabilities that relate to the Business and are as specified in the Asset Purchase Agreement. Certain liabilities relating to the Business were retained by us, including certain environmental, pension and post-retirement healthcare liabilities. In 2011, we recorded an after-tax gain on the sale of $36.5, which is included in Net (loss) gain on sale of discontinued operations, net of tax in the accompanying consolidated statements of income. The results of operations of the former Building Block Chemicals segment are reported as discontinued operations, and are therefore excluded from both continuing operations and segment results for all periods presented. All previously reported financial information has been revised to conform to the current presentation.

The following table displays summarized activity in our condensed consolidated statements of operations for discontinued operations during the years ended December 31, 2013, 2012 and 2011.



Years ended December 31,	2013									2012						2011
	Coatings			Distribution			Total			Coatings			Total			Coatings			BBC			Total
Net sales	$	368.0		$	—		$	368.0		$	1,487.4		$	1,487.4		$	1,657.1		$	96.2		$	1,753.3
Earnings from operations of discontinued businesses before income taxes⁽¹⁾⁽³⁾	$	48.1		$	—		$	48.1		$	190.9		$	190.9		$	126.6		$	10.0		$	136.6
Income tax expense on operations⁽²⁾⁽³⁾	(16.5		)	—			(16.5		)	(73.5		)	(73.5		)	(39.5		)	(2.1		)	(41.6		)
Gain (loss) on sale of discontinued operations	17.9			(12.5		)	5.4			21.3			21.3			—			58.4			58.4
Income tax expense on gain on sale	(34.8		)	—			(34.8		)	(12.7		)	(12.7		)	—			(21.9		)	(21.9		)
Adjustment to fair value, less cost to sell	—			—			—			(27.5		)	(27.5		)	—			—			—
Income tax benefit on adjustment	—			—			—			2.8			2.8			—			—			—
Earnings from discontinued operations, net of tax	$	14.7		$	(12.5	)	$	2.2		$	101.3		$	101.3		$	87.1		$	44.4		$	131.5


(1)	Included in earnings of discontinued operations before income tax expenses for the year ended December 31, 2012 were expenses of $23.4 related to the Coating Resins sale process. For the years ending December 31, 2012 and 2011, includes net restructuring charges of $1.6 and $20.8, respectively, and environmental charges (credits) of $1.7 and ($4.5), respectively.


(2)	Income tax expense on discontinued operations for the year ended December 31, 2012 includes a $7.6 of tax expense on estimated unrepatriated earnings of international subsidiaries from the anticipated sale of Coating Resins.


(3)	The assets and liabilities of the Coating Resins Segment were reclassified to held-for-sale effective June 30, 2012. Accordingly, depreciation and amortization were no longer recorded on these assets beginning July 1, 2012.

Assets and liabilities held for sale

The following table displays a summary of the assets and liabilities held for sale as of December 31, 2012.



December 31,	2012
Assets
Trade accounts receivable, net	$	192.5
Inventories, net	195.0
Other current assets	22.2
Plants, equipment and facilities, net	432.7
Acquisition intangibles, net	252.9
Goodwill, net	323.1
Other assets	53.1
	$	1,471.5
Liabilities
Accounts payable	$	164.5
Accrued liabilities	100.8
Pension and other postretirement benefits	88.0
Deferred income taxes	51.8
Other liabilities	59.1
	$	464.2
Net assets held for sale	$	1,007.3

Other divestitures

On July 12, 2013, we sold the Industrial Materials distribution product line, which we acquired from Umeco in July 2012, to Cathay Investments for $8.6, subject to final working capital and other customary adjustments. In 2013, we recorded an after-tax charge of $12.5 to adjust our carrying value of the disposal group to its fair value less cost to sell, based on the terms of the agreement. The charge is included in Net (loss) gain on sale of discontinued operations, net of tax in the consolidated statements of income. The results of operations of the former Industrial Materials distribution product line prior to its divestiture remain in continuing operations for all periods presented, as the results of operations for the business and assets and liabilities sold were not material to disclose as discontinued operations or assets held for sale.

On September 30, 2011, we sold our Stamford, Connecticut research and development facility for $11.0 cash. The transaction included the leaseback of certain portions of the facility for a 7 year period, with an option to extend the lease for an additional 3 years. As part of the agreement, we were responsible for the remediation of certain environmental matters at the site and therefore, as a result of the environmental remediation obligation, we were precluded from recognizing the sale until the remediation was completed. On the date of the transaction, the carrying value of the facility exceeded the proceeds received by $21.5. However, since the facility supports the operations of multiple asset groupings that had sufficient undiscounted cash flows to support the in-use value of the facility, no impairment charge was recorded at that time. Therefore, in the fourth quarter of 2011, we adjusted the estimated remaining useful life of the facility to the 7 year initial lease period and began accelerating the depreciation over that period. In the fourth quarter of 2012, we completed remediation and recognized the sale. As a result, we recorded a pre-tax loss of $(16.7) in 2012 for the remaining excess carrying value, which is included in Net (loss) gain on sale of assets in the consolidated statements of income.

During the first quarter of 2011, we sold a former manufacturing plant in Bogota, Colombia for which we recorded a net gain of $3.3, which is recorded in Net (loss) gain on sale of assets in the accompanying consolidated statement of income for 2011.