NAPERVILLE, Ill., Jan. 16, 2009 (GLOBE NEWSWIRE) -- Nalco Holding Company (NYSE:NLC) today announced that it has completed internal reorganization efforts aimed at speeding global innovation, aligning business processes with customer needs and increasing productivity through operating efficiencies.
As part of the organizational realignment, Nalco today completed a reduction in force that has removed more than 400 positions from the organization since October 1. In addition to an already taken third quarter 2008 restructuring charge, an additional charge of about $20 million is expected to be shown when year-end 2008 results are announced on February 3. Run-rate annual savings from these actions are expected to total more than $40 million.
"We have completed the planned significant personnel and organizational changes needed to help position Nalco to succeed in 2009 and beyond, despite very challenging global economic conditions. Now our leadership team and employees can completely focus on running the business and helping our customers to succeed," Nalco Chairman, President and Chief Executive Officer J. Erik Fyrwald said.
"To better serve our customers, we are driving our businesses going forward using an integrated business management approach, with our Division leaders having full responsibility for driving revenue, earnings, cash flow and return on capital. Therefore, in addition to sales and marketing responsibility, they will have responsibility for the other resources needed to drive performance -- including supply chain operations, research, finance, human resources and other capabilities," noted Fyrwald. "While this is standard practice at many companies, Nalco has historically separated functional responsibility from business sales and marketing. These changes will ensure that all efforts are aligned on winning in the marketplace."
In support of this change, Nalco formed a new Water and Process Services Division to focus on customers across industrial, paper and institutional markets with our water, air and process applications. The new organization combines the best of the former Industrial and Institutional Services and Paper Services divisions.
"The creation of the Water and Process Services Division allows us to better leverage our substantial scale and technology advantages against competitors -- several of whom compete in both paper process and water treatment markets," Fyrwald said. "This new organization streamlines middle management -- enabling faster communication and execution between senior management and customer-driven sales engineers. At the same time, we will maintain industry-specific focus in our marketing and research to remain on the cutting edge of technology development and service. The new division is also structured for the realities of today's economic environment, and allows us to more quickly move talent to the best growth opportunities."
Nalco Executive Vice President Dave Flitman has been named President of the Water and Process Services Division. He has global leadership responsibility for the segment. Executive Vice Presidents David Johnson and Eric Melin have regional implementation accountability for Water and Process Services and overall Nalco regional management responsibility as Presidents of Europe, Africa and the Middle East (EAME) and Asia/Pacific, respectively. Flitman will lead the global Water and Process Services Leadership team that includes Johnson and Melin.
While Paper Services will be integrated with the water business operationally, its financial results will continue to be reported independently.
Nalco's Energy Services Division will now have full accountability for Energy customers globally, in addition to broad cross-functional responsibility internally. "Most of our customers served by Energy Services operate globally. In order to continue to ensure that we provide high-quality, consistent services and technologies, we will manage this business in the same manner," Fyrwald said. "Energy Services markets remain key growth opportunities for Nalco, and this new structure puts us in the best position to successfully develop to our market potential." Steve Taylor leads the global organization as Executive Vice President and President, Energy Services.
About Nalco
Nalco is the world's leading water treatment and process improvement company, delivering significant environmental, social and economic performance benefits to our customers. We help our customers reduce energy, water and other natural resource consumption, enhance air quality, minimize environmental releases and improve productivity and end products while boosting the bottom line. Together our comprehensive solutions contribute to the sustainable development of customer operations. More than 11,500 Nalco employees operate in 130 countries supported by a comprehensive network of manufacturing facilities, sales offices and research centers to serve a broad range of end markets. In 2007, Nalco achieved sales of more than $3.9 billion. For more information visit www.nalco.com.
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This news release includes forward-looking statements, reflecting current analysis and expectations, based on what are believed to be reasonable assumptions. Forward-looking statements may involve known and unknown risks, uncertainties and other factors, which may cause the actual results to differ materially from those projected, stated or implied, depending on many factors, including, without limitation: ability to generate cash, ability to raise capital, ability to refinance, the result of the pursuit of strategic alternatives, ability to execute work process redesign and reduce costs, ability to execute price increases, business climate, business performance, economic and competitive uncertainties, higher manufacturing costs, reduced level of customer orders, changes in strategies, risks in developing new products and technologies, environmental and safety regulations and clean-up costs, foreign exchange rates, the impact of changes in the regulation or value of pension fund assets and liabilities, changes in generally accepted accounting principles, adverse legal and regulatory developments, including increases in the number or financial exposures of claims, lawsuits, settlements or judgments, or the inability to eliminate or reduce such financial exposures by collecting indemnity payments from insurers, the impact of increased accruals and reserves for such exposures, weather-related factors, and adverse changes in economic and political climates around the world, including terrorism and international hostilities, and other risk factors identified by the Company. Accordingly, there can be no assurance that the Company will meet future results, performance or achievements expressed or implied by such forward-looking statements. This paragraph is included to provide safe harbor for forward-looking statements, which are not generally required to be publicly revised as circumstances change, and which the Company does not intend to update.