The joint venture was launched in 1998 to develop and sell paint and coatings to the European railway transportation industry. Sico said the divestiture would boost productivity and profitability, particularly for the company's industrial paints business in North America. The company said revenue for the venture business fell sharply this year after generating $5.2 million (Canadian), or about $4.3 million U.S., in 2003.
Sico President and Chief Executive Pierre Dufresne said the transaction will have no significant impact on the company's results for 2004, though the divestiture is expected to improve Sico's industrial-sector profitability in the subsequent quarters. Dufresne said Sico would "further focus our human and financial resources on the North American industrial coatings market, currently showing encouraging signs of a recovery."
Sico is reported to be Canada's largest coatings maker, with about 1,000 employees in Canada, the United States and Mexico.