Lanxess Sets More Revamping

Lanxess has embarked on a third round of restructuring measures. Among the major areas to be affected: styrenic resins, polybutadiene rubber, butyl rubber, and inorganic pigments. Lanxess is targeting a combined annual savings of more than $60 million by 2009.

The restructuring will lead to the loss of 250 jobs, including 80 in South America, about 80 in Addyston, Ohio, and another 80 in Orange, Texas. Lanxess has already announced the closure of a styrenics facility in Camacari, Brazil; following this closure, the entire Americas region will be supplied mainly from Addyston.

The firm announced the restructuring at its 2005 results press conference, where Chairman Axel C. Heitmann reported that "45% of our activities are now profitable"—which he defines as operating earnings of 10% of sales or better—a distinct improvement over 2004. He said a quarter of the company's business is "still unprofitable," or had operating profits of less than 5% of sales; only one business, fibers, actually showed a loss for the year.

Heitmann said, "Any businesses that cannot achieve satisfactory earnings or leading positions under the Lanxess umbrella in the foreseeable future will be placed into partnerships or divested entirely." The Saltigo custom manufacturing business, however, is firmly a part of Lanxess, Heitmann confirmed, particularly with its new strengthened structure and business improvements.