Cerberus Capital Management will pay Newell Rubbermaid $310 million to acquire Anchor Hocking and two of its other operations, Burnes Picture Frame and Mirro Cookware.
Cerberus plans to turn the three businesses into a new company, Global Home Products, which will be based in Columbus.
In 2001, Newell tried to sell Anchor Hocking to Toledo-based glass manufacturer Libbey Inc., but the deal was derailed by regulators.
The new deal is expected to be approved by regulators because Cerberus is not in the glass business.
A Cerberus spokesman said the firm plans no changes at Anchor Hocking's Lancaster operations, which employ 1,000.
``The company has traditionally looked for underperforming assets they can acquire and make more profitable because they believe in those assets,'' spokesman Richard Auletta said.
Like many Lancaster residents, Sandy Huffer, 56, and her family have counted on Anchor Hocking for employment. She used to work there, as did a brother, sister and brother-in-law. Another brother still works there.
It doesn't matter who owns the plant, she said, ``as long as it keeps people working.'' Privately held Cerberus manages $12 billion in assets and recently acquired car-rental companies Alamo and National and Formica, a maker of countertops and laminates. It also owns Fila sportswear.
Anchor Hocking is one of Lancaster's largest employers. Its plant there makes drinking glasses, cookware and other glass products. It has a distribution center and headquarters there.
Auletta declined to say whether Global Home Products has chosen a site for its Columbus office or how many employees it would have.
The new company will be led by George Hamilton, a 17-year Newell Rubbermaid veteran and former Anchor Hocking employee.
Lancaster Mayor David Smith said the deal is good news for the city.
``We've always been concerned about it. As they go, so goes the economy of the community,'' Smith said. ``I think it's a great opportunity for Anchor Hocking to be the captain of its own fate instead of being under the umbrella of a large corporation that was interested in selling it.'' Atlanta-based Newell Rubbermaid has been trying to sell non-core businesses to improve its finances.
``Divesting non-strategic businesses is a priority for 2004,'' Newell Rubbermaid Chief Executive Joseph Galli said in a statement. ``While we still have more work to do, we are moving carefully and quickly to transform Newell Rubbermaid into an organization capable of consistent growth and profitability.'' Analyst Eric Bosshard, who follows Newell Rubbermaid for FTN Midwest Research in Cleveland, said it's unlikely that regulators would oppose this deal.
Still, Anchor Hocking's future is unclear, he said.
``Anchor has a good business with a good name,'' said Bosshard, who has a ``sell'' rating on Newell's stock. ``Newell probably underinvested in it. This could be an opportunity for growth. But it's a tough business. There's lots of import competition and other issues that make life difficult.''
Anchor Hocking said last year that it would invest $30 million in the Lancaster plant over three years and re-open a glass-making kiln it had closed in 2002. The company laid off 175 permanent workers and 160 temporary employees when the kiln closed.
Newell said Anchor Hocking, Burnes and Mirro generated a combined $695 million in sales last year, but it did not break out financial results for Anchor. Burnes is based in Nash, Texas. Mirro is in Manitowoc, Wis.