Huntsman to Close Australian Styrenics Operations
Huntsman Corporation announced it has completed an internal review of the styrenics operations owned by Huntsman Chemical Company Australia Pty Ltd., located at West Footscray, Australia, and has decided to close the facility. The Australian styrenics site is the last commodity polymer plant remaining in the Huntsman portfolio after its divestitures to Nova in 1998, SABIC in 2006, and Flint Hills Resources in 2007. Products produced at the site represent less than 2% of Huntsman's 2008 global sales.
The company expects to cease operation of the West Footscray styrene plant at year end 2009, with subsequent closure of its polystyrene and expandable polystyrene plants in early 2010. The company will book closure costs in 2009 of approximately $25 million (primarily severance) and expects to incur other closure related costs of approximately $15 million in 2010. Additionally, the company will incur environmental remediation costs in an amount yet to be determined.
As reported in the "Corporate and Other" segment of Huntsman's financial statements, the styrenics operations had posted an adjusted EBITDA loss of almost $24 million for 2008, based on an operating loss of approximately $29 million less impairment charges for the year of $5 million. Prior to 2008, the company took an impairment charge and wrote the fixed assets to zero.
The company is committed to compliance with all applicable legal requirements concerning employee entitlements and redundancy payments.
Huntsman's other operations in Australia, including its RMAX(R) expanded polystyrene business, Performance Products, Polyurethanes, Textile Effects and Advanced Materials divisions, are not affected by the announcement and will continue to operate in Australia.
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