DuPont spinoff Chemours closing plant in Delaware, affecting 200 workers, 130 contractors

IndustrialsAssociated Press

The Chemours Co. is closing its Delaware titanium dioxide production facility, which employs about 200 workers, the former performance chemicals business spun off from the DuPont Co. said Thursday.

In addition to closing the Edge Moor manufacturing site near Wilmington, Chemours is shutting down a titanium dioxide production line in New Johnsonville, Tennessee.

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The Edge Moor closing will affect some 200 employees and 130 contractors. The company said it will redeploy employees when possible and offer severance benefits otherwise. No jobs will be lost at the Tennessee facility as a result of the production changes there, officials said.

"A plant closure is never an easy decision, because of its impact on people who are valued members of our company," E. Bryan Snell, president of Chemours Titanium Technologies, said in a prepared statement. "However, we believe this is the right business decision. Chemours is committed to the TiO2 market, and these changes position us for growth in the industry."

Gov. Jack Markell was disappointed for the workers and families affected by the closing of the Edge Moor plant, a spokesman said. The plant has been a major producer of titanium dioxide, a widely used whitening pigment used in a variety of industrial and commercial applications, ranging from toothpaste to paint.

"The administration stands ready to provide support to any workers who need assistance and will remain in close contact with Chemours about the advantages of locating other operations in Delaware," said spokeswoman Kelly Bachman. "Overall, our economy continues to make good progress with job growth that leads the region and we remain focused every day on ways to ensure good employment opportunities exist for every Delaware worker."

Chemours said it expects $45 million in annual cost savings as a result of the moves, and about $110 million non-cash charges related to the facility closing in the third quarter. Additional restructuring and other charges related to severance, decommissioning and site redevelopment are estimated at between $75 million and $85 million over the next two or three years.

The Edge Moor plant is configured to produce a TiO2 product for use in the paper industry in applications that have declined steadily for years, with an accompanying slowdown in demand that has resulted in underused capacity at Edge Moor, the company said.

"Our plants in Mississippi, Tennessee, Mexico and Taiwan enjoy industry-leading productivity, as well as the ability to use ore feedstock across the quality spectrum," Snell said. These factors give us a low-cost position that is a key competitive advantage. Meanwhile, underused capacity at our Edge Moor plant keeps it from being cost-effective. And the line at Johnsonville (line 3) is relatively small scale and high cost compared to our other production units. By shutting these down we're concentrating our resources in a way that plays to our strengths."

Chemours expects to halt production at Edge Moor and on the small-scale line at New Johnsonville in late September. Decommissioning at Edge Moor is expected around March, followed by dismantling of the facilities, which could take a year or longer, depending on future use of the site.

Chemours spokeswoman Janet Smith said the company was not aware of any area at Edge Moor that requires remediation, but that it will continue to work with state environmental officials to identify any potential remediation needs.

Shares of Chemours were down 12 cents, or about 1.3 percent, to $9.64 in late afternoon trading.