France's Total says to restructure, avoid layoffs
French energy company Total said Monday it plans carry out a global restructuring of its activities into two divisions in order to improve performance and save itself amid a declining market.
Total plans to reorganise its activities into a refining and chemicals unit plus a supply and marketing unit by the beginning of 2013 without any forced layoffs.
"The proposed reorganisation does not change Totals overall scope," said Christophe de Margerie, Chairman and CEO of Total.
"We remain fully integrated, from oil and gas exploration to the manufacturing and sale of refined products and plastics.
To date the company has been organised into upstream, downstream and chemicals unit."
"What it will do is allow us to better capture all opportunities arising from our integrated business model," added Margerie.
The company's 15,000 service stations will be put in the supply and marketing division. Total employs over 96,000 people in more than 130 countries.
Margerie said later that the poor global economic prospects pushed the restructuring.
"Total is a nice company, there is no doubt, but there is bit of a need to shake that up," he said.
"The urgency is that the market is poor. It's been a while that the European market hasn't grown, and there's even been a bit of contraction," Margerie added.
De Margerie said the company does not plan to sell any activities nor emit new shares. Late Monday, shares in Total rose 1.41 percent in a Paris market up more than 2.0 percent.
Total generates most of its profit from the production and sale of crude oil. Its refining, distribution and chemicals businesses have usually accounted for less than 20 percent of profit.
© 2011 AFP