Less than two months after spinning off from DuPont Co., Chemours Co. is taking steps to reduce its production capacity for titanium dioxide (TiO2), a common plastics whitener.
Wilmington, Del.-based Chemours will close its Edge Moor TiO2 plant in Dover, Del. In a move that will eliminate 330 jobs, including 200 Chemours employees and 130 contractors. The plant has 330 million pounds of annual production capacity.
TiO2 made there primarily is used by the paper industry, in applications that have been in decline for several years, officials said in an Aug. 20 news release. The chloride process used to make white pigment was developed at Edge Moor in 1948. The plant sits on land that once was owned by Pennsylvania state founder William Penn.
Chemours also will close a TiO2 production line at its Johnsonville plant in New Johnsonville, Tenn. No job loss data from that move was included in the release. Both the Edge Moor and Johnsonville actions are expected to be in place by the end of September.
“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,” president and CEO Mark Vergnano said in the release.
Chemours titanium technologies President E. Bryan Snell added that a plant closure “is never an easy decision, because of its impact on people who are valued members of our company.”
“Chemours is committed to the TiO2 market,” he said. “These changes position us for growth in the industry.” After the closings, Chemours will continue to make TiO2 at plants in Mississippi, Tennessee, Mexico and Taiwan.
The firm will take a $110 million third-quarter charge for the Edge Moor closing. Other costs related to the closing are expected to total $75 million to $85 million in 2016-17. The Edge Moor and Johnsonville closings are expected to create $45 million in annual cost savings.
Chemours is a spinoff of DuPont's Performance Chemicals unit. The firm — which opened under the new name on July 1 — is a global leader in titanium dioxide and fluoropolymers, including those sold under the Teflon brand name.
Performance chemicals had struggled in recent years for DuPont, and officials believed the unit would have better growth opportunities as a public company. For full-year 2014, Performance Chemicals reported sales of $6.5 billion, down 6 percent from 2013, and operating earnings of $934 million, down 8 percent.
On Wall Street, Chemours' per-share stock price was at $16.50 on July 1 but closed near $9.60 on Aug. 20 — a drop of almost 42 percent since the firm went public.