Trelleborg AB will "gradually discontinue" manufacturing at the Houston office of its offshore and construction business and transfer production to the United Kingdom.
The Trelleborg, Sweden-based maker of seals, pipes and connections is restructuring its business, which includes subsea buoys made in Houston for deepwater environments such as drilling equipment.
The Texas site covers nearly 500,000 square feet, according to Trelleborg's website, and makes products using a variety of polymers including drill riser buoyancy products using syntatic foam cores and fiberglass exteriors.
In a Nov. 28 statement, Trelleborg said Fredrik Meuller, president of the offshore and construction unit, will leave his position at the end of 2017. However he will remain within the group during a transitional period to assist in the handover.
President and CEO Peter Nilsson will become acting business area president for the business unit.
Trelleborg added that it will be implementing many strategic measures to secure its competitiveness in the offshore oil and gas segment.
The condition of this market "has been challenging for a long time and still is," said the Swedish rubber and plastics goods manufacturer.
Production equipment from Houston will be transferred and consolidated to existing operations in Skelmersdale, England, whose manufacturing focuses on other types of deep-water buoys and engineered polymer systems.
Trelleborg said its U.S. sales and engineering organization will be retained.
Restructuring costs will be recognized as an expense in the fourth quarter of 2017 amounting to about $69.4 million, Trelleborg said.
The company expects to improve earnings for the effected operations by about $12 million per year under the prevailing market conditions.
According to Nilsson, the structural changes are expected to make the group's earnings potential and sales become "more stable and predictable."
