OM Group, Inc. announced that the company has notified Dow Corp. that OM Group will cease production of its tungsten carbide fine powders, effective immediately. In a related move, OM Group will close its tungsten reclamation/cobalt recycling and production facility in St. George, Utah, beginning Dec. 1. Eliminating these operations will improve 2003 operating profit and cash flows by approximately $12 million.
The company also announced it is currently in negotiations to sell its tungsten business and assets. OM Group acquired the tungsten carbide production facility and technology patents from Dow in 1998. Under a present contract, Dow operates OM Group's tungsten carbide production facility in Midland, Michigan. OM Group has sufficient inventory to satisfy existing customer obligations through mid-2003 at current sales volumes.
OM Group acquired the business and equipment located on the St. George site in 1995 where it reclaimed tungsten and cobalt from metal scraps.
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