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Solvay accelerates reorganization due to COVID-19

January 15/2021

MOSCOW (MRC) -- Solvay says it has accelerated changes that form part of the companys G.R.O.W. strategy, announced at the end of 2019, due to the new economic reality linked to COVID-19, reported Chemweek

The strategy involves a reorganization of the company's businesses and efficiency improvements to create a new operating model and simplified portfolio. When announcing the strategy, Solvay said it was targeting cost cuts of EUR300-350 million (USD366-427 million) by 2024. G.R.O.W. stands for growth, resilient cash, optimize, win.

Solvay says in a statement emailed to CW on Wednesday that it is re-examining its business support activities, which has accelerated the changes. These activities include human resources, facilities, information technology, communications, finance, procurement, industrial, strategy, and legal functions.

In the new operating model, corporate functions and business support activities will be led centrally and deployed locally as needed, sharing the same global standards, processes, and tools across the board and leveraging operational efficiency within the group, the statement says.

The decision to implement the new operating model for business support activities will be taken after a consulting phase, Solvay says. The implementation should start in the second quarter of 2021 and be fully implemented by mid-2022, it says.

Solvay issued the statement in response to Belgian press reports that it plans to cut hundreds of jobs as part of a restructuring plan. Newspaper De Tijd reports that an unidentified source has said 900 jobs would be affected. Solvay, which has a workforce of about 24,000, reportedly informed employees and trade unions of its plans on Wednesday morning.

As MRC informed earlier, in August, 2020, through the acquisition of the Solvay polyamide (PA) business, BASF  enhanced its R&D capabilities in Asia Pacific with new technologies, technical expertise, and upgraded material and part testing services. BASF is planning to integrate the R&D centers from Solvay into its R&D existing facilities in Shanghai, China, and Seoul, Korea. The enhanced capabilities will boost BASFs position as a solution provider to develop advanced material solutions for key industries.

We remind that BASF-YPC, a 50-50 joint venture of BASF and Sinopec, undertook a planned shutdown at its naphtha cracker on 30 April 2020. The company initially planned to start turnaround at the cracker on April 5, 2020. The plant remained under maintenance unitl 18 June, 2020. Located in Jiangsu, China, the cracker has an ethylene capacity of 750,000 mt/year and propylene capacity of 400,000 mt/year.

Ethylene and propylene are feedstocks for producing polyethylene (PE) and polypropylene (PP).

According to MRC's DataScope report, PE imports to Russia decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports. At the same time, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.

Solvay is a science company whose technologies bring benefits to many aspects of daily life. With more than 24,100 employees in 64 countries, Solvay bonds people, ideas and elements to reinvent progress. The Group seeks to create sustainable shared value for all, notably through its Solvay One Planet plan crafted around three pillars: protecting the climate, preserving resources and fostering  better life. The Groups innovative solutions contribute to safer, cleaner, and more sustainable products found in homes, food and consumer goods, planes, cars, batteries, smart devices, health care applications, water and air purification systems. Founded in 1863, Solvay today ranks among the worlds top three companies for the vast majority of its activities and delivered net sales of EUR10.2 billion in 2019. Solvay is listed on Euronext Brussels (SOLB) and Paris and in the United States, where its shares (SOLVY) are traded through a Level I ADR program.


mrcplast.com
Author:Margaret Volkova
Tags:Asia, Europe, PP, PE, homopolymer PP, propylene, HDPE, ethylene, compounding, petrochemistry, poliamid, BASF, Sinopec, Solvay, Belgium, China, Russia.
Category:General News
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