Middlebury, Connecticut--Crompton Corp. has announced that it expects to settle direct purchaser class action lawsuits in rubber chemicals, EPDM and nitrile rubber for a total of $97 million. The company will establish a $93.1 million reserve in its 2004 financials.
"We believe this settlement represents a good resolution of a very difficult issue," said Robert L. Wood, chairman, president and CEO of Crompton. "It allows us to reduce risks associated with prolonged litigation and potential treble damages. We also believe it is a fair resolution with respect to the company and our customers. This settlement, while costly, is manageable. We believe that it's in Crompton's best interest to resolve these issues so that management can turn its full attention to creating value for our shareholders."
The company said that once agreement has been reached on allocations, each of the three courts in which the lawsuits are pending will be asked to give preliminary approval of the settlements. Once preliminary approval is obtained, class members will be notified and given the opportunity to participate in or opt out of the settlement. If a sufficient level of class member participation is reached, results will be reported to the respective courts and final approvals sought. If too many class members opt out, the company may decline to settle with particular classes or rescind the entire agreement.
Crompton held a conference call on January 12, 2005. To access the call, dial +1 612 288-0340. The webcast is available on Crompton's Investor Relations page at www.cromptoncorp.com and replay of the conference call will be available for two weeks beginning at 10:45 a.m., Jan. 12, by calling (320) 365-3844, access code 765525.
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Statement from Crompton
Webcast of conference call about settlement (14:00 UK time / 15:00 European time / 09:00 Eastern US)
Website of Crompton Corp