Rhein Chemie

Realignment of Rhein Chemie – Investment in production facilities and reduction in personnel costs at Mannheim site

Realignment of Rhein Chemie – Investment in production facilities and reduction in personnel costs at Mannheim site

Wednesday, 11. July 2007 Following negotiations with employee representatives, the management of Rhein Chemie Rheinau GmbH, a wholly owned subsidiary of chemicals group LANXESS, has adopted a comprehensive realignment program. This further strengthens the company’s core business in the areas of specialty chemicals and innovative service concepts.

Mannheim – Following negotiations with employee representatives, the management of Rhein Chemie Rheinau GmbH, a wholly owned subsidiary of chemicals group LANXESS, has adopted a comprehensive realignment program. This further strengthens the company’s core business in the areas of specialty chemicals and innovative service concepts.
Rhein Chemie is to invest around EUR 7 million in the modernization of existing units and the construction of new production facilities at its Mannheim site.

At the same time, the program is designed to save EUR 5 million annually – through both the modernization of facilities and reductions in personnel costs. In total, some 70 jobs are to be eliminated at the Mannheim site in the next few years. This is to be done in a socially responsible manner.

“Supplementing our growth projects in Asia, this program particularly enhances the competitiveness of the Mannheim site,” said Dr. Anno Borkowsky, CEO and President of Rhein Chemie Rheinau GmbH. “The planned investments express a commitment to Rhein Chemie’s headquarters.”

“This savings package is the result of intensive negotiations,” said Works Council Chairman Rainer Hippler, commenting on the results. “Unfortunately, headcount reductions could not be totally avoided. However, they are to be effected in a socially responsible manner. We have managed to avert the need to transfer parts of our operations abroad, which had been the original plan and would have meant cutting considerably more jobs at our Mannheim site. We are convinced that with this complete package we have made a significant contribution to safeguarding the future of the production site.”

Rhein Chemie is a chemicals company which has had a successful track record in customized additives and service products stretching back over 100 years. The approximately 900-strong workforce produces and sells products for various sectors of the rubber, lubricant, plastics, and polyurethane industries worldwide. Around 550 staff are employed at headquarters in Mannheim-Rheinau, Germany. The company has subsidiaries and production facilities in Europe, Asia, and North and South America. Rhein Chemie is a wholly owned subsidiary of LANXESS Deutschland GmbH, Leverkusen, Germany.

Mannheim, 11. July 2007
bit (2007-07-809EN)

Forward-Looking Statements

This news release contains forward-looking statements based on current assumptions and forecasts made by the management of Rhein Chemie Rheinau GmbH. Various known and unknown risks, uncertainties and other factors could lead to material differences between the actual future results, financial situation, development or performance of our sole stockholder LANXESS Deutschland GmbH and the estimates given here. These factors include those discussed in LANXESS AG’s reports to the Frankfurt Stock Exchange. LANXESS AG and Rhein Chemie Rheinau GmbH assume no liability whatsoever to update these forward-looking statements or to conform them to future events or developments.