New York (AFP) – US chemicals giant DuPont announced plans Tuesday to cut 1,700 jobs from its headquarters as it restructures ahead of its planned merger with Dow Chemical.
The layoffs, tied to a $700 million cost-cutting plan announced by DuPont on December 11, will have a “significant” impact on Delaware, the mid-Atlantic state where the company is based, said chief executive Ed Breen in a message to employees reviewed by AFP.
The job cuts reflect “the urgent need to restructure our cost base and, as part of that effort, reduce our corporate overhead costs so that we can remain competitive,” Breen said.
“The change also reflects the impact of our efforts to move corporate functions into the businesses, closer to our customers.”
Breen cushioned the blow to DuPont’s home state by announcing that Wilmington, Delaware, would become the headquarters for the specialty products business following the DuPont-Dow merger. Specialty products is one of three major businesses that the combined company, DowDuPont, would be divided into.
DuPont currently employs about 54,000 people, including 7,000 in Delaware. The company has previously said it plans to cut 10 percent of its workforce.
Regulators are reviewing the proposed merger between DuPont and Dow Chemical, which would create the world’s biggest chemical and materials company, valued at about $130 billion.
The two companies have said they expect savings of around $3 billion from the merger, expected to be completed in the second half of 2016, as well as an additional $1 billion in growth synergies.
Shares in Dow member DuPont were up 1.9 percent at $67.73 in afternoon trade, while Dow Chemical rose 1.7 percent to $52.64.