Eastman Chemical, which saw 2011 revenue and earnings increase by 23% and 18%, respectively, in January announced the acquisition of Solutia, a fellow manufacturer of specialty chemicals and performance materials. CFO Curt Espeland, who joined the Kingsport, Tenn.-based company in 1996 and has been its finance chief since 2008, helped steer the capital-intensive chemicals and specialty plastics provider through the financial crisis and through recent initiatives, such as the divestiture of its PET (polyethylene terephthalate) business, its acquisition of Genovique Specialties Corp. and its joint venture in Korea. Espeland, one of Treasury & Risk's CFOs to Watch in 2011, explains Eastman's approach to major initiatives, including M&A, and how the company incorporates benchmarking to optimize the results. 

T&R: What key factors does Eastman analyze when deciding whether to pursue initiatives such as the Solutia acquisition?

Espeland: It starts with Eastman having a position of strength. In the world of finance, that means good cash flow management. What allows us to get into a position of strength is not only the underlying strength of our businesses but the strength of the balance sheet. When we looked at the opportunity to grow and align with Solutia, we talked about growing in the core businesses and leaning more toward the emerging markets, but we've always said it must be a good financial deal as well.