By Tess Stynes
Dow Chemical Co. expects to reduce its global workforce by
roughly 3%, part of an effort to streamline the company ahead of
the pending spinoff of a significant portion of its chlorine
business.
In a news release Monday, Dow said "minor footprint adjustments"
will be made to certain manufacturing operations, which are
expected to represent less than 1% of the company's net property
value. The changes include "minor consolidation and shut downs" in
response to a changing market.
Dow said the streamlining plan, set to be completed over two
years, is expected to result in a workforce reduction of 1,500 to
1,750 positions. The company expects to post related charges and
write-downs of $330 million to $380 million during the second
quarter. With the latest moves, Dow is aiming to save roughly $300
million a year in operating costs.
Dow, based in Midland, Mich., recently agreed to spin off a
significant portion of its chlorine business to smaller
chemical-maker Olin Corp. in a cash-and-stock deal valued at $5
billion, to shift toward making higher-profit chemicals and
products. That deal is expected to close by the end of the
year.
The chemical maker last month reported that its profit rose 41%
in the first quarter, but the company could have made more if
falling crude-oil prices and the strength of the U.S. dollar
compared with global currencies hadn't cut into sales.
Write to Tess Stynes at tess.stynes@wsj.com
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