Swiss company Clariant announced it would shut down its sunliquid® bioethanol production in Podari, Romania, because of the continued losses. The company will also downsize related activities of the biofuels & derivatives business line in Germany.

The plant in Podari began producing bioethanol in the second quarter of 2022, following an investment of EUR 140 million.

In July 2023, Clariant started evaluating options for the plant “after it became clear that the plant did not achieve Clariant’s targeted operational parameters,” the company said.

“Clariant management has concluded that, given continued losses, the economics of the plant in Podari cannot justify for Clariant to continue ramp up, which would require significant additional capital expenditure,” the company said in an announcement on December 6.

With the closing of the plant in Romania, 120 jobs will be lost, Reuters reported.

“After a careful review of all the strategic options, we have decided to close the Podari operation. We will work closely with employee representatives in Romania and Germany and are committed to finding solutions that are most socially responsible. For a company that focuses as much on innovation as we do, it is imperative to take firm decisions when a project does not fulfil expectations and to execute even more rigorously on our sustainable growth strategy,” Conrad Keijzer, Chief Executive Officer of Clariant, said.

The restructuring costs and provisions relating to the closure and downsizing of approximately CHF 60 – 90 million, impacting EBITDA, will be incurred in December 2023, the company said. In addition, further impacts of approximately CHF 110 million will be incurred at the EBIT level, including a non-cash impairment to the current asset value of the Podari plant and other remaining assets. These amounts will be reflected in the full year 2023 results, due to be announced in February 2024.

Clariant also anticipates a cash impact relating to the closure costs of approximately CHF 110 – 140 million in the full year 2024. Additional costs of maintaining required capabilities relating to the technology licenses of CHF 10 – 15 million are anticipated in the full year 2024.

(Photo: clariant.com)

simona@romania-insider.com