Credit: Shutterstock photoChemical maker AlbemarleALB has revealed its plans to transfer production of n-Butyllithium from its plant in New Johnsonville, TN, to its facilities in Germany and Taiwan in a move to rationalize n-Butyllithium capacity.
Although n-Butyllithium production will be transferred to Germany and Taiwan, the New Johnsonville plant will continue to make certain specialty lithium products and support blending operations for Albemarle's North American customers. The transfer process is expected to consummate in first-quarter 2016.
The transfer is part of Albemarle's efforts to cut redundancies in its global operations. The company noted that operational savings from the move are vital for maintaining its leadership position in the lithium market. Given the global shifts in n-Butyllithium demand, Albemarle's facilities across Germany and Taiwan are more strategically located to support its future growth in the industry.
The rationalization of n-Butyllithium production capacity at the New Johnsonville plant supports the company's plans to leverage on synergies from its $6.2 billion acquisition of Rockwood Holdings.
Albemarle, last week, said that it has started the commissioning activities related to its new lithium carbonate production plant based in northern Chile. The facility is slated start commercial production of lithium carbonate during third-quarter 2015.
Albemarle has spent roughly $200 million on the plant to make sure that it enables the company to meet the fast-growing customer demand for lithium, especially high purity lithium compounds needed for making lithium-ion batteries. The plant will provide a reliable supply of high quality products, maintaining Albemarle's position as a global leader in lithium production.
Albemarle has realigned its global business units following the closure of the Rockwood Holdings acquisition. The move aligns the company's strategic assets and businesses to be market focused and enables it to more effectively leverage its resources on innovation and growth.
The new structure will help Albemarle achieve its strategic objectives of growing faster, performing at even higher levels and speed up the recognition and achievement of synergies beyond the identified cost synergies. It will also help the company to leverage its long-term lithium strategy.
Albemarle is a Zacks Rank #3 (Hold).
Other stocks in the chemicals space worth considering include LyondellBasell Industries N.V. LYB , Celanese Corporation CE and Stepan Company SCL with all carrying a Zacks Rank #1 (Strong Buy).
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
