Chemical maker Chemtura Corp said it was looking at selling some assets in order to pay back its debt due in July this year and that it plans to reduce inventories. Chemtura's 2009 notes, worth about $370 million, are due on 15 July.
"We are continuing where possible to make variable the fixed costs at our manufacturing facilities by curtailing production lines and furloughing employees as required to balance the reduced demand from our customers," Chairman, President and CEO Craig Robertson said in a statement.
The company plans to reduce indirect costs by about $50 million by eliminating layers and broadening job scope among employees. Suspending dividend payments, the company said its preliminary results show that the fourth quarter and the full year revenues were lower, compared to last year.
The Middlebury, Connecticut-based Chemtura said preliminary results indicate that fourth quarterly sales declined to $690 million from $891 million a year ago. Full year revenue slipped to $3.546 billion from $3.747 billion in the comparable period.
The company, "sought relief from our lending banks and subsequently entered into a 90-day amendment and waiver agreement with lenders under its senior credit facility on 30 December, 2008." said Robertson. Furthermore, Chemtura closed on its $150 million US accounts receivable facility with a three-year term and terminated its former facility on 30 January.
Moody's Investors Service cut its ratings on Chemtura deeper into junk territory on Thursday, and said it may cut them again, citing concerns over the company's tight liquidity and looming debt maturity. Moody's cut the company one notch to "B3," six steps below investment grade.
Shares of Chemtura were trading up 4 per cent at 52 cents Tuesday morning on the New York Stock Exchange.