Lonza closes sites in North America and UK

January 22, 2010

Pharmaceutical Technology Europe

In response to economic pressures, the Lonza Group will close three sites in 2010 in North America and in the UK, which will affect 175 employees.

In response to economic pressures, the Lonza Group will close three sites in 2010 in North America and in the UK, which will affect 175 employees. After consulting with local employee representatives and authorities, Lonza has created a comprehensive severance package and pledged to treat employees in a fair and transparent manner, according to a Lonza press statement.

Q4 of 2010 will see the close of the company’s Conshohocken site (PA, USA). Projects from the site will be transferred to other operations within Lonza’s global network. Meanwhile, the company’s pilot-scale plant in Shawinigan (Canada), which manufactures vitamin K3 will cease production by the end of March 2010 after developing proprietary, environmentally-friendly technology. Lonza has said it is considering ways of providing customers with chromium-free vitamin K3 from other sites.

The company will also close the offices and warehouse in Wokingham (UK) and transfer their activities to Verviers (Belgium) to modernise and streamline its supply chain. The Verviers facility now supplies all countries in Europe.

The company’s restructuring cost totals approximately CHF 140 million, of which 75% represents restructuring activities in small molecules. The amount also includes impairments of assets and other restructuring activities and will be booked into 2009.

The restructuring follows the company's October 2009 statement that it would reduce fixed costs by CHF 60–80 million during a period of 18–24 months and review its business units’ strategies. The company said it was taking these measures in response to the volatile market environment.

Lonza has also said that it plans to reinforce its presence in Asia, including its platform in Nansha (China).

www.lonza.com