Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: TUESDAY, April 25, 1995 TAG: 9504250098
SECTION: CURRENT PAGE: NRV-1 EDITION: NEW RIVER VALLEY
SOURCE: PAUL DELLINGER STAFF WRITER
DATELINE: PULASKI LENGTH: Medium
The company, a wholly owned subsidiary of Mitsui Mining & Smelting Ltd. of Tokyo since last November, is also investing about $2 million in equipment as part of the restructuring.
It is eliminating 40 of its 173 employees under a plan to restructure the company that started when Mitsui completed its acquisition of Magnox last fall. The 40 employees, including both hourly and salaried workers, were notified last Friday.
"It is hoped that this is it," company spokesman John Lambert said Monday when asked about the possibility of future reductions. "It's due to automation and a need to reduce labor expenses."
The Pulaski company makes magnetic oxides for use in the production of video, audio and computer tapes, and magnetites for use as toners in copy machines.
The company originated in the 1960s as a unit of Hercules Inc. In 1986, nine Hercules managers purchased it and later associated themselves with Mitsui. Mitsui bought 60 percent of the company in 1989 and another 20 percent in 1992.
The decision to eliminate positions was a difficult one, Lambert said, but is necessary because of changes in plant processes and organizational structure.
He said it will probably take a year or two to gauge the effects of the restructuring. If the demand or prices for the products made by Magnox should go up, he said, there could be a possibility of more hiring then.
Until now, changes in employment at Magnox have been up rather than down.
All employees were told in January that an analysis of the entire company was under way.
The new equipment is supposed to improve efficiency and achieve a more consistent product quality, to satisfy the increasingly strict quality requirements throughout the world. Some processes will be changed to increase production.
The company will rely on Mitsui for its research and development, and cut its own expenses in those areas. It will also reduce the overall number of its products.
The change in the product mix is aimed at enhancing profits. Restructuring is common in the industry, which is suffering from increased costs for the raw materials it uses.
Magnox is a major exporter of products, and has competition both in this country and abroad.
by CNB