Essentra plc announces that it is entering into consultation regarding the proposal to cease the production of folding cartons for the consumer goods industry at Newport, UK and, as a consequence, to close its cartons facility (“IP5”).
In addition, IP5 remains structurally challenged in terms of its operational and financial performance,
notwithstanding the short-term focus and remedial action of the senior management team – together with the significant improvement efforts of the site General Manager and employees.
Against this backdrop, a number of strategic options for IP5 have been assessed by the senior management team, supported by an independent expert third party, in terms of their respective financial, implementation and stakeholder implications. Having given each of these options their careful consideration, the Board of Essentra has concluded that the proposal to close the IP5 facility is the most appropriate route.
If the proposal is confirmed, the production of folding cartons in Newport will cease by the end of 2017 and will be overseen by a dedicated project management team, supported by selective external expertise. The proposed closure of IP5 is expected to result in an exceptional charge in H2 2017 of approximately GBP 35 million, of which c. GBP 13 million represents a non-cash charge.
Essentra is a leading global provider of essential components and solutions.
