Shutdown of Edge Moor Plant in Delaware and Production Line in Tennessee will Position TiO2 Business for
Growth and is Expected to Deliver $45
Million Net Cost Reduction
WILMINGTON, Delaware,
Aug. 20, 2015 /PRNewswire/ -- The
Chemours Company ("Chemours") (NYSE: CC), a global chemical company
with leading market positions in titanium technologies,
fluoroproducts and chemical solutions, announced today two
decisions that are elements of the company's five-point
transformation plan.
The company will close its Edge Moor manufacturing site located
outside Wilmington, Delaware,
which produces titanium dioxide (TiO2) and will shut
down a TiO2 line (line 3) at its Johnsonville plant in
New Johnsonville, Tennessee.
Together, these actions will eliminate roughly 150,000 metric
tonnes of TiO2 capacity while refocusing TiO2
production at four manufacturing sites that employ the full range
of Chemours TiO2 technology strengths. These changes
position Chemours to grow in the TiO2 industry by
enhancing its production capabilities. Most importantly, they allow
the company to continue to meet the needs of its customers around
the globe.
"The decisions we are announcing today are connected directly to
our five-point transformation plan, which sets out a clear,
achievable path to our becoming a higher value chemistry company,"
said Mark Vergnano, president and CEO of Chemours.
The Edge Moor plant is configured to produce a TiO2
product for use in the paper industry, in applications that have
declined steadily for years, with an accompanying slowdown in
demand that has resulted in underused capacity at Edge Moor.
Chemours will work with current Edge Moor TiO2 customers
to continue to provide them with similar product from the company's
Johnsonville plant.
The Edge Moor plant has approximately 200 employees and 130
contractors. Chemours will redeploy employees wherever possible and
where redeployment is not possible employees will receive severance
benefits.
"A plant closure is never an easy decision, because of its
impact on people who are valued members of our company," said E.
Bryan Snell, president of Chemours Titanium Technologies. "However,
we believe this is the right business decision. Chemours is
committed to the TiO2 market, and these changes position
us for growth in the industry."
"Our manufacturing capabilities are our greatest strength,"
added Snell. "Our plants in Mississippi, Tennessee, Mexico and Taiwan enjoy industry-leading productivity, as
well as the ability to use ore feedstock across the quality
spectrum. These factors give us a low-cost position that is a key
competitive advantage. Meanwhile, underused capacity at our Edge
Moor plant keeps it from being cost-effective. And, the line at
Johnsonville (line 3) is relatively small scale and high cost
compared to our other production units. By shutting these down
we're concentrating our resources in a way that plays to our
strengths."
As part of the company's transformation plan, these closures are
expected to result in a $45 million
annual net cost reduction. The company will incur non-cash charges
of approximately $110 million related
to the facility closing in the third quarter. Additional
restructuring and other charges related to severance,
decommissioning and site redevelopment are expected to be in the
range of $75 million to $85 million
and incurred during the next two-to-three years.
The company is targeting the end of September to stop production
at Edge Moor and Johnsonville line 3. At Edge Moor, Chemours
expects to complete decommissioning around March 2016 and then begin dismantling facilities,
which could take a year or longer depending on future use of the
site. Chemours will work with all of our site customers during this
transition.
To help ease this transition for the community, Chemours will
begin immediately exploring options for site redevelopment that
align with the best interests of the surrounding Edge Moor
community and local and state economic development leaders.
The Chemours five-point transformation plan is focused on five
strategic elements: reducing structural costs, growing market
positions, refocusing investments, optimizing the portfolio, and
enhancing the organization.
About The Chemours Company
The Chemours Company
(NYSE: CC) helps create a colorful, capable and cleaner world
through the power of chemistry. Chemours is a global leader in
titanium technologies, fluoroproducts and chemical solutions,
providing its customers with solutions in a wide range of
industries with market-defining products, application expertise and
chemistry-based innovations. Chemours ingredients are found in
plastics and coatings, refrigeration and air conditioning, mining
and oil refining operations and general industrial manufacturing.
Our flagship products include prominent brands such as Teflon™,
Ti-Pure™, Krytox™, Viton™, Opteon™ and Nafion™. Chemours has
approximately 9,000 employees across 37 manufacturing sites serving
more than 5,000 customers in North
America, Latin America,
Asia-Pacific and Europe. Chemours is headquartered in
Wilmington, Delaware and is listed
on the NYSE under the symbol CC. For more, information please visit
chemours.com.
Forward-Looking Statements
This press release
contains forward-looking statements, which often may be identified
by their use of words like "plans," "expects," "will," "believes,"
"intends," "estimates," "anticipates" or other words of similar
meaning. These forward-looking statements address, among other
things, our anticipated future operating and financial performance,
business plans and prospects, transformation plans, resolution of
environmental liabilities, litigation and other contingencies,
plans to increase profitability, our ability to pay or the amount
of any dividend, and target leverage that are subject to
substantial risks and uncertainties that could cause actual results
to differ materially from those expressed or implied by such
statements. Forward-looking statements are not guarantees of future
performance and are based on certain assumptions and expectations
of future events which may not be realized. The matters discussed
in these forward-looking statements also are subject to risks,
uncertainties and other factors that could cause actual results to
differ materially from those projected, anticipated or implied in
the forward-looking statements as further described in the "Risk
Factors" section of the information statement contained in the
registration statement on Form 10 and other filings made by
Chemours with the Securities and Exchange Commission. Chemours
undertakes no duty to update any forward-looking statements.
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CONTACTS:
MEDIA:
Janet E.
Smith
Global Public Affairs Leader
+1.302.773.4508
janet.e.smith@chemours.com
INVESTORS:
Alisha
Bellezza
Director of Investor Relations
+1.302.773.2263
alisha.bellezza@chemours.com