BY DAVID KRECHEVSKY, REPUBLICAN-AMERICAN
Middlebury-based Chemtura Corp. announced plans Thursday to cut at least 500 jobs as part of a cost-reduction program. The announcement comes just four days after the company named a new chief executive.
Chemtura officials could not be reached for comment Thursday, but according to the company's press release the cuts are part of a restructuring program intended to reduce fixed costs by about $50 million.
"This initiative involves a worldwide reduction in its professional and administrative staff by approximately 500 people," or about 20 percent of its approximately 2,500 white-collar workers, the release states. The cuts will reduce the company's overall work force by nearly 10 percent.
In addition to the 500 jobs cut, the company said it is altering its plant production rates to be more in line with customer demand and inventory reduction goals. That will include modifying work hours and "furloughing or reducing production personnel as required," the release states.
The company's statement Thursday did not include specifics of where or when it will cut white- or blue-collar jobs, or how many of its workers in Connecticut will be affected.
Of the nearly 5,100 people it employs worldwide, about 600 are in Connecticut. Most of those positions are in Middlebury, at Chemtura's 199 Benson Road headquarters, with others spread between facilities in Bethany and Naugatuck.
The company said the job cuts will cost an estimated $15 million to $20 million over the next three quarters, but it will take a charge in the fourth quarter to reflect those costs.
Chemtura is a $3.7 billion manufacturer of specialty chemicals, crop protection and pool, spa and home-care products. The company was formed by the 2005 merger of Crompton Corp. of Middlebury and Great Lakes Chemical Corp. of Indianapolis.
According to the company's statement, the cost-reduction program is needed because of declining orders for its products, primarily affecting Chemtura's Polymer Additives and Performance Specialties business segments.
The announcement was made after the stock markets closed Thursday evening. Chemtura has been plagued by liquidity-related concerns during the past several months and its shares have fallen more than 80 percent since reaching a 52-week high of $8.81 in June. Thursday, the stock closed at $1.17 per share, down 17 cents, or about 12.7 percent.
In November, the company said it would suspend its dividend, slash capital spending and reduce inventories in an effort to shore up its liquidity.
In addition, late Monday the company announced it had named Craig A. Rogerson, 52, its new president, chief executive officer and chairman of the board. Rogerson had been president, CEO and a director of Hercules Inc. until its acquisition by Ashland Inc. last month.
He succeeded Robert L. Wood, 54, one of the chief architects of the 2005 merger that created Chemtura. Wood resigned for personal reasons, the company said.
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