Dow to sell Ethafoam division
The Dow Chemical Company announced Tuesday it will sell its Ethafoam division, which could mean workers at its Hanging Rock facility could lose their jobs in a year and a half.
Sealed Air Corp., which makes the product Bubble Wrap, has made an offer to buy the Ethafoam, which is a polyethylene foam packaging used in a wide variety of applications in the transportation, defense, automotive and sports industries.
The deal has to have governmental approval, which is expected by the end of the year. Dow said it does not release financial details of this type of agreement.
“Manufacturing of Ethafoam products will continue as part of a supply agreement for up to 18 months following close of this deal, at which time Sealed Air will commence manufacturing of the products at its own facilities,” said Carl Darling, Hanging Rock site leader. “This announcement does not impact production at Hanging Rock of our primary product Styrofoam brand insulation.”
In a press release, Dow stated that the number of jobs impacted once Ethafoam production ceases is uncertain.
“We are unsure at this point how many employees will be impacted as we are making efforts to redeploy them into other positions on site or at other Dow locations once the supply agreement ends in 6-18 months after close of the deal,” said Rosemarie Rung, a Dow spokeswoman. “Until then, we are continuing to make product.”
Dow will offer affected employees the opportunity for redeployment to other jobs within Dow or — where redeployment opportunities do not exist — severance benefits.
“We understand that this transition phase will generate uncertainty among our workforce and we are focused upon continually communicating with employees,” Darling said. “Equally important, throughout this process we will remain focused on delivering on our environmental, health and safety commitments.”
Besides the Hanging Rock facility, the only other place in the world that makes Ethafoam is a manufacturing plant in Drusenheim, France.