German chemicals giant BASF SE (BASFY,BFA.L) said it will cut about 500 jobs worldwide by the end of 2015, including 350 in Switzerland, and also streamline processes as part of a restructuring at its performance products segment.
BASF plans to significantly increase competitiveness at the segment in the coming years by streamlining processes, investing in new technologies and adjusting its portfolio as well as its organizational setup.
The restructuring involves businesses with plastic additives, pigments, water, leather and textile chemicals. The currently planned measures will lead to a reduction of about 500 positions worldwide by the end of 2015, the company noted.
Michael Heinz, member of the Board of BASF SE and responsible for the Performance Products segment, said, "The expansion of our specialty business in the Performance Products segment made us more robust to economic fluctuations. However, the growth and profitability of the standard products do not yet meet our requirements. We have therefore identified numerous measures which we are implementing step by step. Further measures are being analyzed."
BASF plans to improve the efficiency and profitability of the Plastic Additives and Pigments & Resins business units in Europe, which are mainly located in the Basel area. The restructuring will lead to up to 350 job cuts in the Basel area by the end of 2015.
In the Pigments & Resins business unit, European product and quality management and product safety will be pooled in Ludwigshafen. Meanwhile, global product management lead for the business will be bundled in Hong Kong.
In the Plastic Additives business, BASF will consolidate supporting functions, such as technology and strategy management as well as controlling, in Ludwigshafen.
BASF noted that these strategies will lead to a decrease in the need for product-related research in plastic additives and pigments in the Research Center Basel, which will be scaled down. Lower need for administrative services will lead to a job reduction in the Basel-based Business Center Switzerland. However, the Paper Chemicals division, headquartered in Basel, will not be affected by the current measures, the company said.
As announced previously, BASF is combining its businesses with water, oilfield and mining solutions into a new global business unit. The company noted that the increase in efficiency in the polyacrylamide value chain will lead to a reduction of jobs in the water chemicals business, mainly at the sites in Bradford and Grimsby, United Kingdom.
In addition, BASF plans to divest its industrial water management business, located in Lyon, France, to a strategic partner.
In the business with leather and textile chemicals, BASF will increase its focus on the growing Asia-Pacific region and on high value-adding applications for the leather automotive industry and premium textile articles. The company will establish global R&D activities for both businesses in Shanghai, China.
In Tuesday's regular session, BASFY is trading at $88.31, up $1.69 or 1.95 percent on a volume of 16,688 shares.
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