The Dow Chemical Co. (IW 1000/68) announced on April 2 that it will shut down four plants in response to continued weakness in the European economy.
Dow will shut down three plants that produce STYROFOAM Brand Insulation products located in Estarreja, Portugal; Balatonfuzfo, Hungary; and Charleston, Illinois; and idle a plant in Terneuzen, The Netherlands.
The company will also close its toluene diisocyanate (TDI) plant in Camaari, Brazil.
The closing will result in 900 positions being eliminated.
Dow anticipates that it will save approximately $250 million annually from these actions which will take place over the next two years. The savings are in addition to the $500 million in cash flow that Dow already delivered in 2011 from the inception in May 2011 of its Efficiency for Growth program, and are part of the Companys goal to deliver an additional $250 million of cash flow from cost interventions in 2012.
"These actions, while difficult, are in full alignment with our commitment to continually manage our portfolio to adapt to changing and volatile economic conditions, as we are seeing particularly in Western Europe, and to preferentially invest in our fast-growing, technology-rich businesses," said Andrew N. Liveris, Dow's CEO. "Today's announcement further demonstrates our resolve and ability to take swift, strategic cash flow interventions that will keep Dow solidly on a trajectory to deliver $10 billion in EBITDA in the near term."
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