COLOGNE, Germany—Specialty rubber manufacturer Lanxess will announce the company it is to partner with in the rubber business in early November, according to a source close to Lanxess.
The partnership will mark the third and final phase of the company's realignment program which started in November 2014 in a bid to improve performance.
Saudi Aramco is reportedly among the leading potential partners for Lanxess, with other experts suggesting that Russian petrochemical group Sibur is also in the frame.
“The third phase will focus on improving the competitiveness of the business portfolio, especially through cooperations in the rubber business. Lanxess is currently in talks with potential partners and will report on further steps in the second half of 2015,” the company announced in May.
The second phase, launched earlier in March, aims at improving operational competitiveness. This included the closure of an EPDM plant in, Marl, Germany, and realignment of production networks for EPDM and neodymium-based performance butadiene rubber (Nd-PBR).
Lanxess is currently in talks with both customers and employees about the closure of its EPDM plant in Marl, and will shift production elsewhere. The facility will close down on schedule at the end of 2015, concluding the realignment program.
The firm said about 140 employees will be affected from the realignment of its rubber production footprint. In May, Lanxess said it anticipates exceptional charges of about $58.7 million associated with the reorganization of its EPDM and Nd-PBR production network along with annual savings of about $21.3 million from the end of 2016.
The first phase of the program included reducing 1,000 positions of its work force, which Lanxess said now consists of about 16,700 people in 29 countries with 52 production sites. The firm also consolidated to 10 business units from 14 and to 12 group functions from 16. The first phase will achieve about $160 million in annual savings by the end of 2016.