Dow Announces Job Cuts
Dow Announces Actions to Streamline and Remove Stranded Costs In Advance of Dow Chlorine Products Transaction
MIDLAND, Mich.–(BUSINESS WIRE)– The Dow Chemical Company (NYSE: DOW) today announced a series of actions to further streamline the organization and optimize its footprint as a result of the Companys pending separation of a significant portion of its chlorine value chain.
Dow has shifted its portfolio toward targeted, integrated high-value markets, and as a result the Company is taking additional actions to further enhance its organizational effectiveness with a focus on driving geographic market engagement coupled with global efficiency to deliver maximum value from its growth investments.
The actions will further accelerate Dows value growth and productivity targets, and will result in a reduction of approximately 1,500 1,750 positions, or approximately 3 percent of the global workforce. In parallel, the Company is also announcing additional minor adjustments to its asset footprint to enhance competitiveness.
The Company will take charges totaling approximately $330 million $380 million in the second quarter of 2015 for asset impairments, severance and other costs related to these measures, which are expected to be completed during the next two years. Once fully implemented, these actions are expected to result in approximately $300 million of annual operating cost savings.
At our Investor Day last fall, we committed to a new, three-year $1 billion productivity drive. Our productivity efforts continue to center on cost-out actions and doing more with the resources we have in place, all to enable higher earnings, said Howard Ungerleider, Dows chief financial officer. We executed against each of our financial, operational and strategic objectives again in the first quarter, and todays announcement illustrates our ongoing commitment to the consistent implementation of our strategy moving forward and proactively addresses any stranded costs from the divestment of Dow Chlorine Products.
In parallel, minor asset footprint adjustments will be made to select manufacturing facilities. The facilities impacted represent less than one percent of the Company's net property value and include minor consolidation and shut downs in response to changing market dynamics and to position the relevant businesses for long-term growth.
The Company will involve local stakeholders as defined in each country and in compliance with relevant information and consultation processes.
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