HUNTSMAN Corporation announced today (Wednesday, 6 July) a plan to close its 25,000 metric ton titanium dioxide manufacturing facility based in Umbogintwini during the fourth quarter 2016.
Closure of the facility will have a cash pay-back of less than two years.
Cost savings from this closure are in addition to the approximately $200 million previously announced.
Employing about 140 associates, the Umbogintwini plant is the smallest and oldest TiO2 manufacturing plant in the pigments and additives division.
Under the proposed plan, production at the plant will end during the fourth quarter of 2016 after which Huntsman will serve its customers in the region with existing capacity from its European TiO2 facilities.
“Our margins remain well below historical norms, despite some recent recovery from tough conditions,” said president of Huntsman Pigments and Additives division, Simon Turner.
“It is critical that we continue our successful cost reduction and synergy programme to combat such conditions.
We have sufficient capacity across our production network to allow us to close our smallest facility, still meet our customers’ needs and improve our overall competitiveness.
We appreciate the support of our associates at the Umbogintwini facility and we will work closely with them and our representative groups to ensure that we manage this difficult situation with due care and respect.”
Peter R Huntsman, president and CEO of Huntsman Corporation, said: “This closure increases the competitive positioning of our pigments and additives business and is an important step in the process as we work towards a separation.
The separation of our pigments and additives business will come through either a spin to our shareholders or another strategic transaction. We continue to diligently work towards this objective.”
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