15 November 2002
ELEMENTIS ANNOUNCES RESTRUCTURE OF CHROMIUM OPERATIONS
Following the announcement in October of the agreement to acquire the chromium chemical business of US based Occidental
Chemical Corporation, Elementis is now able to give initial details of the planned integration.
On completion of the acquisition, the OxyChem operation at Castle Hayne, North Carolina will become Elementis
Chromium's primary US operation producing dichromate and chromic acid to serve the North American market.
The Elementis Chromium operations at Corpus Christi, Texas will be significantly rationalised and the dichromate and
chromic acid operations shut down resulting in the loss of around 60 jobs by the end of the year. At the end of the
rationalisation, the dichromate kiln and chromic acid equipment will be mothballed. Chromic oxide and chrome hydrate
production operations will continue at the site as part of the new Elementis Chromium. We are now in discussion with
our employees affected by these changes.
Elementis believes that the acquisition and integration of OxyChem's chromium chemical business will generate
significant cost savings through optimising operations, reducing overhead and procurement costs and obtaining supply
chain benefits. Annualised cost savings of at least £10 million will be generated during the first two years.
One-time cash costs of restructuring the combined business are estimated to be £4 to £5 million in 2002. Elementis
expects the acquisition to be completed by the end of 2002.
Commenting on the restructuring, Geoff Gaywood, Chief Executive of Elementis plc said, 'This move will create a US
chromium chemicals producer able to compete effectively in a market that is subject to significant import penetration
and inefficient capacity utilisation as a result of the expected restriction on the use of chromated copper arsenate
for consumer applications announced by the US Environmental Protection Agency earlier this year.
'Upon closing, we plan on the smooth integration of operations with emphasis on high standards of customer service.'
- Ends -
Elementis plc +44 (0)1784 224212
Geoff Gaywood Chief Executive
Brian Taylorson Finance Director
Anna Passey Head of Corporate Communications
Brunswick +44 (0)20 7404 5959