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Rohm & Haas is cutting 900 jobs

Rohm & Haas Co., following other chemical companies, said today that it would eliminate 900 jobs in the United States and overseas because of the recession that has battered its core housing and electronics markets.

In this July 10, 2008 file photo, pedestrians walk near the Rohm and Haas Co. headquarters in Philadelphia. The specialty chemicals maker said Tuesday, Jan. 20, 2009, it's cutting about 900 jobs, idling or closing plants and will record $90 million in pretax charges for the fourth quarter. (AP Photo / Justin Maxon, file)
In this July 10, 2008 file photo, pedestrians walk near the Rohm and Haas Co. headquarters in Philadelphia. The specialty chemicals maker said Tuesday, Jan. 20, 2009, it's cutting about 900 jobs, idling or closing plants and will record $90 million in pretax charges for the fourth quarter. (AP Photo / Justin Maxon, file)Read more
    by Bob Fernandez, INQUIRER STAFF WRITER
    Published 

Rohm & Haas Co., following other chemical companies, said today that it would eliminate 900 jobs in the United States and overseas because of the recession that has battered its core housing and electronics markets.

This is the second restructuring in eight months for the Philadelphia chemical giant. Last June, Rohm & Haas announced 925 job cuts in the U.S., including plant closings. Then, Rohm & Haas chief executive Raj Gupta said the domestic paint market was weak. The company is one of the world's largest manufacturers of paint additives.

The actions in June and yesterday take out about 12 percent of Rohm & Haas' workforce. "I can't give any more details because employees haven't been notified," company spokeswoman Emily Riley said. "This is a worldwide restructuring." Rohm & Haas employs about 3,000 in the Philadelphia area, including Delaware.

The company will take a $90 million pre-tax and impairment charge in the fourth quarter. The new cuts will save about $90 million a year in operating costs. Rohm & Haas also said it would freeze discretionary spending and employee salaries, where possible. The company said it expected fourth-quarter earnings from continuing operations to exceed analysts' consensus estimate of 62 cents a share.

Dupont and Dow Chemical Co., the nation's two biggest chemical companies, also recently announced thousands of job cutbacks. Air Products and Chemicals Inc. of Allentown said today that it will eliminate about 40 jobs at an electronics chemicals plant in Glendon, Pa.

Dow, based in Midland, Mich., has a deal to acquire Rohm & Haas for $78 a share, or $15.2 billion in cash. The deal, negotiated in July, is in limbo because Dow doesn't have final approval from the Federal Trade Commission and some of its financing fell through. Riley said there is no deadline for the final U.S. approval.

Dow hoped for $7 billion in cash by spinning off manufacturing plants in a joint venture with a company connected to the Kuwaiti government. In late December, Kuwait abandoned the deal, which had been negotiated over two years, because of plummeting oil prices.

Dow said it had 1,500 pages of legal documents ready to sign for the joint venture and will sue Kuwait for $2.5 billion for backing out.

Ratings agencies have said they could downgrade Dow's debt if it proceeds with the Rohm & Haas deal without new financing arrangements.

During a bad day on Wall Street, Rohm & Haas shares fell $2.58 to $58 a share - 25 percent below the negotiated price with Dow.

Dow shares fell $1.14 to $13.89. Dow's stock-market capitalization is $12.8 billion, significantly below the $15.2 billion it has said it will pay for Rohm & Haas.