COLOGNE, Germany—Lanxess A.G. revealed in its second quarter financials that it has initiated a process that will transfer its rubber business to a legally independent business entity within the Lanxess Group.
The plan is for the new entity to comprise its Tire & Specialty Rubbers and High Performance Elastomers business units. The two combine to operate 20 production facilities with about 3,700 employees.
A company spokesman said the creation of a legally independent business entity facilitates the reporting of key financial figures, such as sales or EBITDA (earnings before interest, taxes, depreciation and amortization), making it easier to bring the rubber business into a potential alliance.
The process is part of Lanxess' three-phased realignment program, which CEO Matthias Zachert said is on schedule. The third phase is focused on improving the competitiveness of the business portfolio through potential alliances in the rubber business.
Zachert said in an Aug. 6 news release detailing the firm's financials that Lanxess is “currently engaged in very constructive discussions and assumes that it will achieve concrete results in the course of the second half of the year.”
Lanxess confirmed in the release that the first phase of realignment has been implemented successfully. It resulted in about 1,000 job cuts worldwide and the consolidation to 10 business units from 14. A recent development in the realignment included U.S.-based Rhein Chemie Corp. merging into Lanxess Corp.'s Rhein Chemie Additives unit, no longer operating as a separate legal entity, the firm said.
Lanxess has initiated measures of the second phase, which involves the restructuring of its EPDM and neodymium-based performance butadiene rubber production, affecting about 140 employees worldwide. The firm will halt EPDM rubber production at its facility in Marl, Germany, and will realign its EPDM and Nd-PBR production to four strategic regional facilities.