Lonza to carve out Specialty Ingredients unit, cut 130 jobs in restructuring push

Lonza headquarters
Lonza will carve out its Specialty Ingredients (LSI) business as part of efforts to reorganize the slumping division. (Lonza)

Swiss pharma and chemical supplier Lonza will carve out its Specialty Ingredients (LSI) business as part of its effort to reorganize the slumping division.

The move will result in the elimination of about 130 jobs, the company said.

LSI posted lackluster first-quarter results that were partly attributed to a March explosion at a Chinese chemical plant that killed 62 people.

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The action, which the company said is already underway, is expected to be completed by mid-2020. The segment will remain fully owned by Lonza.

In what was dubbed a “qualitative look” at the company’s first-quarter numbers, Lonza CEO Marc Funk said in April the disruption from the explosion contributed to “headwinds” for the company’s specialty ingredient business. 

“Our decision will allow the segment to focus on its strengths and drive future growth in a dynamic and competitive environment,” Funk said in a statement about the carve-out Monday. “More widely, it reflects our commitment to enabling the segment to become the leading global player in microbial control.”

The deadly explosion March 21 in Yancheng, China, underscored challenges that country is facing with its huge chemical and ingredient supply industry in terms of both safety and pollution. Plus, it outlined global dependence on chemical ingredients for the pharma industry that come from China.

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