8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of report:June 1, 2009

SOLUTIA INC.

(Exact Name of Registrant as Specified in Its Charter)

Delaware

(State or Other Jurisdiction of Incorporation)

001-13255 (Commission File Number)	43-1781797 (IRS Employer Identification No.)
575 Maryville Centre Drive, P.O. Box 66760 St. Louis,  Missouri (Address of Principal Executive Offices)	63166-6760 (Zip Code)

(314) 674-1000

(Registrant’s Telephone Number, Including Area Code)

N/A

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the follow provisions:

[  ]  Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[  ]  Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[  ]  Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[  ]  Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.01.  Completion of Acquisition or Disposition of Assets.

On June 1, 2009, Solutia Inc., a corporation formed under the laws of the State of Delaware (“Solutia”), completed the sale to an affiliate of SK Capital Partners II, L.P., a limited partnership formed under the laws of Delaware (“SK Capital”), of a majority interest in Ascend Performance Materials LLC (f/k/a NyCo LLC) (“Ascend”).  Prior to the consummation of the transaction, Ascend was a wholly-owned subsidiary of Solutia into which Solutia had contributed substantially all of the assets that constituted Solutia’s nylon business (the “Nylon Business”) and which assumed all of the liabilities of Solutia related to the Nylon Business (with limited exceptions).  The transaction was consummated pursuant to that certain Transaction Agreement, dated as of March 31, 2009 (the “Transaction Agreement”), by and among, Solutia, Ascend, SK Capital, and SK Titan Holdings LLC, a limited liability company formed under the laws of the State of Delaware and a direct, wholly-owned subsidiary of SK Capital and certain of its affiliates (“Buyer”).

As part of the transaction, following the contribution to Ascend of assets and assumption by Ascend of liabilities related to the Nylon Business noted above, Solutia contributed all of the equity interests of Ascend to Ascend Performance Materials Holdings Inc., a Delaware corporation (“Holdings”), in exchange for $50 million of cash, which amount was and is subject to adjustments, and 2% of the stock of Holdings.  Also as part of the sale transaction, Buyer contributed cash to Holdings in exchange for 98% of the stock of Holdings.  As part of the transaction, Solutia will also receive an additional $4 million of cash in four annual installments beginning on September 1, 2011.

The foregoing summary of the Transaction Agreement does not purport to be complete and is qualified in its entirety by the Transaction Agreement, which was attached as Exhibit 10.1 to the Company’s current report on Form 8-K, filed with the Securities and Exchange Commission on April 1, 2009, and the description thereof in the current report, each of which is incorporated herein by reference.

A copy of the press release announcing the completion of the transaction is attached as Exhibit 99.1 hereto.

Financial statements accounting for the Nylon Business as a discontinued operation were included in Solutia’s Interim Report on Form 10-Q for the quarter ended March 31, 2009, filed with the Securities and Exchange Commission on May 7, 2009 and Solutia's Annual Report on Form 10-K for the year ended December 31, 2008, filed with the Securities and Exchange Commission on February 19, 2009.

Item 9.01.  Financial Statements and Exhibits.

(d)                 Exhibits.

Exhibit Number	Description
99.1	Press Release of Solutia Inc., dated June 1, 2009.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	SOLUTIA INC.
Date:  June 3, 2009	By:	/s/ Paul J. Berra, III
		Name: Paul J. Berra, III
		Title:   Senior Vice President, General Counsel and Chief Administrative Officer

EXHIBIT INDEX

Exhibit Number	Description
99.1	Press Release of Solutia Inc., dated June 1, 2009.

EX-99.1

Exhibit 99.1

NEWS

FOR IMMEDIATE RELEASE	Solutia Inc. 575 Maryville Centre Drive St. Louis, Missouri 63141 P.O. Box 66760 St. Louis, Missouri 63166-6760
	Media:  Dan Jenkins (314) 674-8552 Investors:  Susannah Livingston (314) 674-8914

Solutia Completes Sale of Nylon Business

Portfolio Now Focused on Performance Materials and Specialty Chemicals

ST. LOUIS – June 1, 2009 -- Solutia Inc. (NYSE: SOA) today announced that it has completed the sale of its nylon business to an affiliate of SK Capital Partners II, L.P.

“This sale completes Solutia’s transformation into a pure-play performance materials and specialty chemicals company, with a portfolio of high-value products that hold world-leading positions,” said Jeffry N. Quinn, chairman, president, and CEO of Solutia Inc.

Solutia’s portfolio consists of three business segments – Saflex®, Technical Specialties, and CPFilms® – each of which offer attractive margins and growth potential.  These businesses are diversified geographically, with attractive long-term end-market characteristics.

Quinn added, “Solutia is well positioned to generate consistent financial returns and to further develop and enhance its position in the specialty chemicals sector.  We will continue to seek value creation opportunities through the active management of our businesses.”

SK Capital paid Solutia $50 million in cash (subject to a working capital adjustment) for the nylon assets.  Solutia also received a two percent equity stake in the new company formed to hold substantially all of the assets of the nylon business.  In addition Solutia will receive $4 million in deferred cash payments to be paid in annual $1 million installments beginning in 2011.  SK Capital also has secured replacement of $25 million of letters of credit associated with the nylon business, which has resulted in increased availability for Solutia under its credit agreements. The affiliate of SK Capital will assume substantially all of the liabilities of the nylon business, including employee and pension liabilities relating to the active employees of the business and environmental liabilities.  Solutia used the proceeds of the nylon sale to pay down debt under its asset-based revolving credit facility.

# # #

Forward Looking Statements

This press release may contain forward-looking statements, which can be identified by the use of words such as “believes,” “expects,” “may,” “will,” “intends,” “plans,” “estimates” or “anticipates,” or other comparable terminology, or by discussions of strategy, plans or intentions.  These statements are based on management’s current expectations and assumptions about the industries in which Solutia operates and Solutia's ability to raise additional funds which is subject to market conditions.  Forward-looking statements are not guarantees of future performance and are subject to significant risks and uncertainties that may cause actual results or achievements to be materially different from the future results or achievements expressed or implied by the forward-looking statements.  These risks and uncertainties include, but are not limited to, the risk and uncertainties regarding the consummation of the transactions described in this press release or the timing thereof, including the possibility that the conditions to consummating the transactions may not be satisfied or that the transactions may not close, and those other risks and uncertainties described in Solutia’s most recent Annual Report on Form 10-K, including under “Cautionary Statement About Forward Looking Statements” and “Risk Factors”, and Solutia’s quarterly reports on Form 10-Q.  These reports can be accessed through the “Investors” section of Solutia’s website at www.solutia.com.  Solutia disclaims any intent or obligation to update or revise any forward-looking statements in response to new information, unforeseen events, changed circumstances or any other occurrence.

About Solutia Inc.

Solutia is a market-leading performance materials and specialty chemicals company.  The company focuses on providing solutions for a better life through a range of products, including: Saflex® interlayer for laminated glass; CPFilms® aftermarket window films sold under the LLumar® brand and others; and technical specialties including the Flexsys® family of chemicals for the rubber industry, Skydrol® aviation hydraulic fluid and Therminol® heat transfer fluid.  Solutia’s businesses are world leaders in each of their market segments.  With its headquarters in St. Louis, Missouri, USA, the company operates globally with approximately 3,100 employees in more than 60 locations.  More information is available at www.Solutia.com.

Source: Solutia Inc.

St. Louis

6/1/09