PolyOne, the US-based materials manufacturer, said it was paying another US firm, Kraton Performance Polymers, $72m (£49.7m) for the latter's thermoplastic elastomer (TPE) business.
PolyOne executives said the deal, which is expected to complete in the first quarter of this year, would allow it to further expand its TPE business, which includes its GLS product line.
PolyOne and Kraton have also entered into a supply agreement under which the latter will supply certain raw materials used by the acquired business.
Kraton said that taking into consideration projected sales under the supply agreement, selling the compounding business will have a net impact on its total sales of less than $25m (£17.3m).
End markets served by the acquired products include adhesive and removable protective films, as well as packaging, medical devices and personal care products.
Robert Patterson, PolyOne's president and chief executive, said: "I'm excited to kick-off 2016 with this acquisition.
"Kraton will continue to supply us with styrenic block co-polymers and we will leverage our expertise in TPE formulation to accelerate growth, primarily in the consumer and healthcare markets."
Kraton president and chief executive Kevin Fogarty said: “This transaction will enable Kraton to focus on its core strengths around polymer design, and enable PolyOne to focus on its leading capabilities as a provider of polymer formulations.”
Meanwhile, PolyOne announced 2015 profits surged 85% to almost $145m (£100.2m), even as sales fell 12% to just under $3.4bn (£2.35bn).
The firm in 2015 also posted adjusted earnings per share (EPS) of $1.96 (£1.35) – the highest in PolyOne's 15-year history. Fourth-quarter adjusted EPS of 39 cents also was a company record. PolyOne now has posted 25 consecutive quarters of year-over-year adjusted EPS growth.
Full-year sales in PolyOne's Designed Structures & Solutions unit – including the former Spartech sheet business – fell almost 27%. Sales in Performance Products & Solutions – including PVC compounds – were down 15%, while sales for Specialty Engineered Materials lagged more than 9%.
Smaller sales losses were seen in distribution (down 7.2%) and Colour, Additives & Inks (down 4.7%).
Based on sales, distribution was PolyOne's largest operating unit in 2015, generating just over 29% of total company sales.