Hexion Specialty Chemicals Announces Intent To Close Clayton, UK Manufacturing Site As Part Of Ongoing Business Growth & Productivity Initiatives

Hexion Specialty Chemicals announced today that as part of its ongoing business growth and productivity initiatives, it intends to shift manufacturing from its location in Clayton, The United Kingdom, to an alternative plant site and plans to cease operations in Clayton at the end of the first quarter 2008.

Hexion acquired the Clayton site in January 2006 from Rhodia as part of its acquisition of Rhodia’s decorative coatings and adhesives business. The Clayton operation produces pressure sensitive adhesives (PSAs), and foam control agents used in coatings and other applications.

Hexion will transfer the manufacturing of PSAs to its plant in Sokolov, The Czech Republic, which manufactures similar products and has the capacity to handle the continuing growth of the PSA product line. The company intends to divest its foam control agent business, which it considers non-core to its overall coatings business. The 28 employees of the Clayton site have been informed of the decision, will be considered for other jobs within Hexion and will be provided with appropriate severance and job placement assistance.

“While we regret the impact of this decision on our Clayton associates, this move is necessary for the continued growth and health of the business,” said Robert Nosal, vice president, global liquid coating resins. “The Clayton site is capacity constrained and a higher-cost manufacturing operation than our Sokolov plant. It is more economical for us to consolidate PSA production in Sokolov as we continue to develop this business.”