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Chemical giant Chemours is in apparent tumult, as CEO and CFO are placed on leave

Wilmington-based chemical giant The Chemours Co., a spinoff of the DuPont chemical empire, is in apparent tumult at the uppermost levels of management.

Three senior executive officers, including the CEO and chief financial officer, have been placed on leave, the company announced to investors Thursday morning.

Shares plunged after the announcement by nearly half at the start of trading Thursday morning, before recovering to $19 by noon — remaining approximately 33% lower than at the beginning of trading that morning.

Two weeks ago, Chemours failed to release its quarterly earnings report as scheduled. A director on the board, Sandra Phillips Rogers, also announced in February she would step down and that a new director would join the board on Friday, March 1.

The lobby of Chemours Wilmington office.
The lobby of Chemours Wilmington office.

Thursday's announcement hit the top levels of executive and financial leadership of the company and also signaled a full audit that includes outside counsel after apparent reports received to the company's ethics hotline.

"What we think many perceived as likely a relatively minor accounting hangup two weeks ago now appears wider, longer, and with more ramifications than the market initially believed," Barclays analyst Michael Leithead told Reuter's news service on Thursday.

Effective immediately, Chemours' board of directors voted to place president and CEO Mark Newman on administrative leave, the company said. The same went for CFO Jonathan Lock, as well as controller and principal accounting officer Camela Wisel.

The administrative leave will continue pending internal review, Chemours' board announced.

The internal review would touch on the company's incentive plans, working capital, and its "internal control over financial reporting." It would also review what the board referred to as the "tone at the top" set by senior management.

The board's audit committee is projected to report on the results of the review, and any "material weaknesses," in the company's delayed annual report.

In the meantime, Chemours has appointed an interim CEO, Denise Dignam, who is president of the company's Titanium Technologies division. The interim CFO will be Matt Abbott, whom the board wrote had "held senior officer roles in operational, accounting and internal audit areas."

Unaudited reports released by Chemours showed the company's expected net sales to come in at $6 billion for last year, down from $6.8 billion in 2022. The company is also expected to report losses of more than $200 million for 2023, compared with profits of $578 million the year before.

The estimated net loss for 2023 includes $746 million of pre-tax litigation settlements. The company, along with fellow DuPont spinoffs Corteva and DuPont de Nemours, have faced billions in lawsuits related to the effects of so-called forever chemicals.

As of the end of 2023, Chemours maintained cash and cash equivalents of $1.2 billion. Chemours employs 6,200 people, according to its most recent report, about 400 fewer than the company reported at the same time last year.

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More: Delaware gets $25M more from ‘forever chemical’ settlement with Chemours, DuPont, Corteva

Matthew Korfhage is business and development reporter in the Delaware region covering all the things that touch land and money. Send tips and insults to mkorfhage@gannett.com

This article originally appeared on Delaware News Journal: Tumult at Delaware based Chemours: CEO and CFO placed on leave

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