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WLK to Cease Operations at Select Facilities Amid Challenges
ZACKS· 2025-12-16 16:05
Core Insights - Westlake Corporation (WLK) has approved a plan to cease operations at three North American chlorovinyl production facilities and a styrene manufacturing unit due to challenging conditions in the global commodities chemicals industry, with closures expected in December 2025 [1][8] Group 1: Facility Closures - The affected facilities include the PVC plant in Aberdeen, MS, the VCM plant in Lake Charles, LA, North site, and a diaphragm chlor-alkali unit at Lake Charles, LA, South site, along with the Lake Charles styrene plant [2][8] - Seven other North American chlorovinyl facilities will continue to supply customers with PVC, VCM, and chlor-alkali products [3][8] Group 2: Production Capacity - Post-closure, the company will have an annual production capacity of approximately 520 million pounds of suspension PVC globally, with 4,900 million pounds in North America, and 7,630 million pounds of VCM globally, including 6,050 million pounds in North America [3] - The company will also maintain a capacity of 6,680 million pounds of chlorine and 7,510 million pounds of caustic soda globally, with 5,410 million pounds of chlorine and 6,100 million pounds of caustic soda in North America [3] Group 3: Financial Impact - The closures will result in a workforce reduction of about 295 employees [4][8] - Westlake expects pre-tax costs of approximately $415 million, primarily from non-cash accelerated depreciation, amortization, asset write-offs, employee severance, and other shutdown costs, with most costs anticipated to be recognized in the fourth quarter of 2025 [4][8]