AkzoNobel to shut down organic peroxides in NL; R&D to stay

AkzoNobel plans to phase out the production of organic peroxides at its site in Deventer, the Netherlands, by the end of 2016. Under the plans, the production activities currently carried out in Deventer will be moved to other existing production facilities in Europe, US and China over the next three years. The shut down will impact approximately 215 employees at the site but AkzoNobel will continue to operate the site's regional R&D technology centre that employs around 235 personnel.

The production facility on the Deventer site is one of 11 organic peroxide manufacturing plants operated globally by AkzoNobel. Organic peroxides are part of the company's Functional Chemicals portfolio within the Specialty Chemicals Business Area. The chemicals are used by AkzoNobel's customers in applications in, among others, the automotive, rubber, packaging and polymers industry and construction and consumer product sectors.

"Global demand patterns for organic peroxides are trending away from mature markets in Europe and becoming increasingly concentrated in Asia and North America," said Werner Fuhrmann, AkzoNobel Executive Committee member responsible for the Specialty Chemicals business.

At the publication of its half-yearly results on July 18, AkzoNobel announced a step-up in restructuring activities to increase savings in 2014 and beyond, over and above the existing EUR500 million Performance Improvement Program which will be completed by the end of 2013, a year early.

Today's announcement is part of this drive and is aimed at increasing efficiencies and productivity, thereby improving performance in its global manufacturing footprint, and takes account of trends in its end-user market segments.

"The organic peroxides market also faces over-capacity," continued Fuhrmann. "Consolidating production and following demand will lead to lower costs to serve our customers, improving our competitiveness and performance."

AkzoNobel does not expect the plans to have any impact on existing customers. To ensure a smooth transition of the product lines to the other facilities and other transitional activities, including facilitating the personnel concerned in finding new employment, the planned process of phasing out production at the site will be carried out over a three-year period. The firm says it is consulting with the employee works councils and labor unions.


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