Imerys Announces Reorganization of Its UK Kaolin Operations

Imerys is today announcing a reorganization of its UK
kaolin business to ensure the future of its operations in the
southwest of England.
Energy accounts for a significant portion of Imerys costs in the
UK and with energy prices sharply surging over the past year, the
competitiveness of the UK kaolin platform has been dramatically
impaired.
In that context, Imerys will stop manufacturing paper coating
grades in Cornwall by the end of 2007. The paper operations in
Cornwall will focus on the production of paper filler kaolins, for
which its natural kaolin reserves are best suited. Imerys' production
capacity for coating grades in Brazil will be expanded accordingly.
At the same time, and for the same reasons, Imerys will close its
hydrous kaolin operations in Devon and consolidate its UK kaolin for
ceramics and for performance minerals base in Cornwall.
This UK reorganization includes a proposal of up to 800 job losses
from the Cornwall and Devon area. Most of the changes will not take
place before the fourth quarter of next year. In the meantime the
company will start a full consultation process with unions and
employee representatives. Plans will be implemented to support any
staff made redundant with a comprehensive outplacement service, an
employee assistance programme that will provide financial advice and
counselling for all employees.
The purpose of this reorganization, along with a significant
capital expenditure program (GBP 25 million), is to secure the future
of the Group's UK operations. It will lead to a substantial accounting
charge corresponding to asset write-offs mostly, and also social
costs. An estimate of that global charge will be released upon
publication of the estimated first-half 2006 results, scheduled for
July 26.

The world leader in adding value to minerals, Imerys is active in
43 countries through over 250 locations. The Group achieved more than
EUR 3 billion in sales in 2005. Imerys mines and processes minerals
from reserves with rare qualities in order to develop solutions that
improve its customers' product performance and manufacturing
efficiency. The Group's products have a great many applications in
everyday life, including construction, personal care, paper, paint,
plastic, ceramics, telecommunications and beverage filtration.