Lubrizol Corp. disclosed last week that it will cut 95 jobs following last months acquisition of Noveon International. Some of the cuts are being made to eliminate redundancies between the two companies, but others stem from a decision to pull back on efforts to move into new markets.
Announcing the action in a June 30 news release, the company said most of the employees affected by the plan were with Lubrizol before the acquisition and hold technical and commercial positions at the Wickliffe, Ohio, headquarters. Management expects the cuts to save $16 million a year before taxes, although they will result in $15 million in severance and settlement costs this year.
Staff reductions are always very difficult, President and Chief Executive Officer James L. Hambrick said. However, the Noveon acquisition created some clear redundancies that we addressed quickly. Both companies headquarters are in the Cleveland area, which has been an obvious advantage for merging and consolidating organizations. As anticipated, during our first month, we are making solid progress with identifying and implementing commercial, operating and financial synergies.
The company confirmed that most of the positions being eliminated were part of Lubrizols former Fluid Technologies for Industry segment, which has been folded into Noveon. The business makes ingredients used in paints, coatings, pharmaceutical applications and personal-care products, as well as industrial lubricants.
It added, though, that other jobs were involved in trying to develop new products in new markets. Officials said the company has realigned its research, development and testing groups. Those will continue looking for growth opportunities but will now focus on Lubrizols existing markets, including lubricants, rather than looking elsewhere.
Lubrizol said the job cuts are scheduled to becomplete by the end of the third quarter. This was the companys second round of layoffs in eight months. Late last year it eliminated 150 positions – 100 of them in Wickliffe – in an effort to reduce costs.