Dow Chemical Cuts 11% Jobs, Closes 20 Plants, Idles 30% Facilities; Shares Up

December 8, 2008 1:29 p.m. EST

Midland, MI (AHN) - The Dow Chemical Co. (NYSE: DOW) announced Monday that it plans to eliminate around 5,000 full-time jobs, shut down 20 facilities in high-cost locations and sell several non-strategic businesses.

In a series of aggressive actions to accelerate its transformational strategy, the company said the job reductions reflect a reduction of roughly 11 percent of Dow's global workforce of 46,000 employees.

We are moving from a highly centralized and standardized approach, to operating three very different business models with a lean and efficient Corporate Center," Dow Chairman and CEO Andrew N. Liveris said in a statement on Monday.

He added, "However, we are accelerating the implementation of these measures as the current world economy has deteriorated sharply, and we must adjust ourselves to the severity of this downturn."

Midland, Michigan-based Dow also said today in the statement that it is preparing to idle as many as 180 plants or 30 percent of its capcity temporarily, which would affect as many as 6,000 contractor worldwide.

Today's measures expected to take as much as $700 million in pretax charge in the fourth quarter, which will reduce earnings for the period by between 50 cents per share and 60 cents per share.

The market analysts expect the company to post earnings of 42 cents per share on average basis for the quarter.

The company had previously announced cost synergies of $800 million by 2010 for the anticipated Rohm and Haas acquisition.

Liveris claims that Dow Chemical is the only company on the Fortune 200 list to have paid its regular quarterly cash dividend without reduction or interruption since 1912.

Dow's stocks were increasing by $1.23 or 6.46 percent to $20.23 at 12.59 p.m. Eastern Time on the New York Stock Exchange in composite trading on Monday, after closing at $19.00 last week.

The stock has remained between a low of $16.41 and a high of $45.50 in the last 52 weeks.