Biocides producer Arch Chemicals will consolidate its U.S. research and development and technical service activities in Alpharetta, Ga., to improve operating margins.
The consolidation, which will cost $6 million to $8 million, will impact Archs facilities in New Castle, Del., Cheshire, Conn., and Conley, Ga., according to a recent filing with the Securities Exchange Commission. The company believes that this decision will provide the best and most effective way to organize these U.S.-based resources to support Archs global biocides business, Arch stated in the SEC filing.
The estimated consolidation costs will include $3 million to $4 million in relocation-related and employee severance costs, Arch noted. The Norwalk, Conn.-based company anticipates completing the consolidation by the end of 2011.
Arch said having R&D and technical service employees working in close proximity to its businesses in Atlanta will better serve customers, improve efficiency, and provide more opportunities for synergy and innovation collaborations.
The company expects to provide more details of its margin improvement plan later this fall. Future communications will outline the expected benefits to be derived from a combination of portfolio management, cost-reduction initiatives, development of new products and innovation to accelerate organic growth, Arch told the SEC.
Archs industrial biocides are used to control the growth of microorganisms in paints, architectural coatings and metalworking fluids. Arch did not reply to Lube Reports request for comments.