8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 17, 2008

SOLUTIA INC.

(Exact name of registrant as specified in its charter)

DELAWARE

(State of Incorporation)

001-13255	43-1781797
(Commission File Number)	(IRS Employer Identification No.)

575 Maryville Centre Drive, P.O. Box 66760, St. Louis, Missouri	63166-6760
(Address of principal executive offices)	(Zip Code)

(314) 674-1000

Registrant's telephone number, including area code

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 2.05 COSTS ASSOCIATED WITH EXIT OR DISPOSAL ACTIVITIES.

On November 17, 2008, Solutia Inc. (“the Company”) made the decision to cease production of Saflex polyvinyl butyral (PVB) interlayers at its Saflex plant in Trenton, Michigan, effective March 31, 2009.  Approximately 115 of the 187 employees at the Trenton plant will be impacted by this action.  The Company’s Trenton Plant will continue to supply other Saflex operations with Butvar PVB resin, which is the key raw material used to make Saflex.

The Company expects that the elimination of production of polyvinyl butyral interlayers will result in estimated pre-tax charges to income from continuing operations of approximately $18 to $20 million.  These charges include cash charges totaling approximately $8 to $10 million, primarily related to severance and employee benefit costs and non-cash charges totaling approximately $10 million,  primarily related to the write–off in net book value of idled manufacturing assets.  Substantially all of the charges will be recognized in the fourth quarter ending December 31, 2008 and the first quarter ending March 31, 2009.  The annualized benefit to income from continuing operations before income taxes is estimated to be approximately $12 million.

Additionally, in line with the Company’s examination of its current demand profile, the Company is initiating a series of actions within its Integrated Nylon business.  On November 21, 2008, the Company announced a restructuring of its Integrated Nylon business, consistent with its overall process of exploring strategic alternatives for the business.  These actions will better align production and cost structure with the current economic environment.  These actions include both reductions to the Company’s contractor and permanent workforce including both unpaid leave and permanent downsizings.  The Company expects that these actions will result in estimated pre-tax charges to income from discontinued operations of approximately $5 million in the fourth quarter ending December 31, 2008 and the first quarter ending March 31, 2009.

Also, the Company is idling certain of its Integrated Nylon manufacturing facilities and permanently shutting down certain bulk continuous filament (BCF) carpet fiber assets at its manufacturing facility in Greenwood, South Carolina.  The shutdown of these manufacturing units at its Greenwood, South Carolina location will result in estimated pre-tax charges to income from discontinued operations of approximately $4 million.  These charges are non-cash charges relating to the write-off of net book value of idled manufacturing assets and will occur in the fourth quarter ending December 31, 2008.

The Company estimates that these restructuring actions within its Integrated Nylon business will result in an annualized fixed cost reduction of approximately $40 million.

ITEM 2.06 MATERIAL IMPAIRMENTS

The information contained in “Item 2.05 Costs Associated with Exit or Disposal Activities” is incorporated herein by reference.

ITEM 7.01 REGULATION FD DISCLOSURE

On November 18, 2008 and November 21, 2008, the Company issued press releases relating to the matters described in this Current Report on Form 8-K.  Copies of these press releases are attached as Exhibits 99.1 and 99.2 to this Current Report on Form 8-K and are incorporated herein by reference.  The information contained in the press releases filed as Exhibits 99.1 and 99.2 are being furnished and shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, and they shall not be deemed incorporated by reference into any filing made under the Securities Act of 1933, except as expressly set forth by specific reference in such filing.

ITEM 9.01  FINANCIAL STATEMENTS AND EXHIBITS.

(d) Exhibits:
Exhibit Number	Description
99.1	Press Release dated November 18, 2008
99.2	Press Release dated November 21, 2008

SIGNATURES

PURSUANT TO THE REQUIREMENTS OF THE SECURITIES EXCHANGE ACT OF 1934, THE REGISTRANT HAS DULY CAUSED THIS REPORT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY AUTHORIZED.

SOLUTIA INC.

(Registrant)

/s/ Rosemary L. Klein

Senior Vice President, General Counsel and Secretary

DATE:  November 21, 2008

EXHIBIT INDEX

Exhibit Number	Description
99.1	Press Release dated November 18, 2008
99.2	Press Release dated November 21, 2008

EX-99.1

	EXHIBIT 99.1
	NEWS

FOR IMMEDIATE RELEASE	Solutia Inc. 575 Maryville Centre Drive St. Louis, Missouri 63141 P.O. Box 66760 St. Louis, Missouri 63166-6760
	Media:  Melissa Hammonds (636) 751-4057
	Investors:  Susannah Livingston (314) 674-5206

Saflex®Trenton Plant to Focus Exclusively on Resin Production

ST. LOUIS – November 18, 2008 – Solutia Inc. (NYSE: SOA) today announced that effective March 31, 2009, its Saflex plant in Trenton, Mich., will be focusing solely on the production of Butvar® PVB resin and therefore will be exiting production of Saflex® polyvinyl butyral (PVB) interlayers at that time.  Approximately 115 of the 187 employees at the Trenton plant will be impacted by this action.

 “As the world leader in PVB interlayers, Saflex continues to invest in new technologies, capabilities and capacity in order to provide our customers with the products they need within their respective world areas,” said Luc De Temmerman, senior vice president of Solutia Inc. and president of Saflex.  “Demand in Europe and Asia has grown faster than the rest of the world, resulting in excess North American capacity and necessitating this action.  In the coming weeks, we will work to ensure our employees impacted by this event are treated fairly and to ensure our customers continue to receive the quality products they need.”

De Temmerman added, “Although this action will remove 30 million square meters of PVB interlayers from the North American market, Saflex will maintain sufficient capacity to serve the market from our two other North American plants.”

The Trenton plant will continue to supply other Saflex operations with Butvar PVB resin, which is the key raw material used to make Saflex.

Saflex is the global leader in PVB production, innovation, quality and reliability. When laminated between layers of glass, PVB interlayers greatly enhance the performance characteristics of glass, providing benefits such as security, solar protection, sound attenuation and safety.  Laminated glass made with Saflex PVB is used extensively in both the automotive and architectural markets, and is now used to encapsulate the world's largest thin film photovoltaic modules.  For more information, please visit: http://www.saflex.com.

###

Forward Looking Statements

This press release may contain forward-looking statements, which can be identified by the use of words such as “believes,” “expects,” “may,” “will,” “intends,” “plans,” “estimates” or “anticipates,” or other comparable terminology, or by discussions of strategy, plans or intentions.  These statements are based on management’s current expectations and assumptions about the industries in which Solutia operates.  Forward-looking statements are not guarantees of future performance and are subject to significant risks and uncertainties that may cause actual results or achievements to be materially different from the future results or achievements expressed or implied by the forward-looking statements.  These risks and uncertainties include, but are not limited to, those risk and uncertainties described in Solutia’s most recent Annual Report on Form 10-K, including under “Cautionary Statement About Forward Looking Statements” and “Risk Factors”, and Solutia’s quarterly reports on Form 10-Q.  These reports can be accessed through the “Investors” section of Solutia’s website at www.solutia.com.  Solutia disclaims any intent or obligation to update or revise any forward-looking statements in response to new information, unforeseen events, changed circumstances or any other occurrence.

Corporate Profile

Solutia is a market-leading performance materials and specialty chemicals company.  The company focuses on providing solutions for a better life through a range of products, including: Saflex® interlayer for laminated glass; CPFilms® aftermarket window films sold under the LLumar® brand and others; high-performance nylon polymers and fibers sold under brands such as Vydyne® and Wear-Dated®; and technical specialties including the Flexsys® family of chemicals for the rubber industry, Skydrol® aviation hydraulic fluid and Therminol® heat transfer fluid.  Solutia’s businesses are world leaders in each of their market segments.  With its headquarters in St. Louis, Missouri, USA, the company operates globally with approximately 6,000 employees in more than 60 locations.  More information is available at www.Solutia.com.

Source: Solutia Inc.

St. Louis

11/18/08

EX-99.2

	EXHIBIT 99.2
	NEWS

FOR IMMEDIATE RELEASE	Solutia Inc. 575 Maryville Centre Drive St. Louis, Missouri 63141 P.O. Box 66760 St. Louis, Missouri 63166-6760
	Media: Dan Jenkins (314) 674-8552
	Investors: Susannah Livingston (314) 674-8914

Solutia Provides Update on Nylon Strategic Alternatives Process;

Implements Nylon Restructuring Plan  

ST. LOUIS – November 21, 2008 – Solutia Inc. (NYSE: SOA) today announced that it is restructuring its Nylon business, consistent with its overall process of exploring strategic alternatives for the business.

“The Nylon strategic alternatives process is moving forward as planned, and we continue to make progress on transactional scenarios that would result in the disposition of these assets,” said Jeffry N. Quinn, chairman, president and CEO of Solutia Inc.  “In the mean time, we are implementing a restructuring plan to position the business for today’s dynamic economic environment.  This plan will result in an annualized fixed cost reduction of approximately $40 million, or 10%, across the Nylon business.”

Solutia announced on June 30, 2008, that it is exploring strategic alternatives for its Nylon business, including a possible sale.  Effective with the third quarter of 2008, the company began reporting results from its Nylon segment as discontinued operations.

“In recent years we have matched our manufacturing output and inventory levels with the very strong demand present across the nylon markets,” said Jim Voss, senior vice president of Solutia Inc. and president of the Nylon business.  “However, in the last several weeks, demand has declined significantly for nylon intermediate chemicals, fibers and resins.  Therefore we are taking necessary actions to align our production and inventories with the current economic environment.”

The key component of the restructuring plan is to temporarily decrease production throughout the Nylon chain – from intermediate chemicals to fibers and resins.  “We anticipate that this will be a temporary situation, and we will bring these assets back to more normal operating rates as inventories decline and demand returns,” added Voss.  “We are meeting our customer commitments and will continue to do so going forward.”

Additional components of the restructuring plan include a business-wide cost-reduction program as well as the permanent shutdown of significant bulk continuous filament (BCF) carpet fiber assets at the plant in Greenwood, SC.  These assets had already been idled earlier this month.

“This action is consistent with our transformation strategy for the Nylon business over the past three years,” said Voss.  “We have now removed nearly all of our dependence on the declining North American carpet fiber market, and are better able to focus our resources on serving the diversified global market for nylon resins and compounds.  Our nylon resins and compounds are still the materials of choice in their respective applications, and we anticipate that demand will rebound and demonstrate the long-term viability of this business.”

The financial impact of the restructuring plan includes cash outflows related to the workforce reductions of approximately $5 million total anticipated in the fourth quarter of 2008 and the first quarter of 2009.  In addition, the non-cash charge from the permanent closure of the Greenwood assets is approximately $4 million, and will occur in the fourth quarter of 2008.

# # #

Forward Looking Statements

This press release may contain forward-looking statements, which can be identified by the use of words such as “believes,” “expects,” “may,” “will,” “intends,” “plans,” “estimates,” “estimated,” or “anticipates,” or other comparable terminology, or by discussions of strategy, plans or intentions.  These statements are based on management’s current beliefs, expectations and assumptions about the industries in which Solutia operates.  Forward-looking statements are not guarantees of future performance and are subject to significant risks and uncertainties that may cause actual results or achievements to be materially different from the future results or achievements expressed or implied by the forward-looking statements.  These risks and uncertainties include, but are not limited to, those risk and uncertainties described in Solutia’s most recent Annual Report on Form 10-K, including under “Cautionary Statement About Forward Looking Statements” and “Risk Factors”, and Solutia’s quarterly reports on Form 10-Q.  These reports can be accessed through the “Investors” section of Solutia’s website at www.solutia.com.  Solutia disclaims any intent or obligation to update or revise any forward-looking statements in response to new information, unforeseen events, changed circumstances or any other occurrence.

Corporate Profile

Solutia is a market-leading performance materials and specialty chemicals company.  The company focuses on providing solutions for a better life through a range of products, including: Saflex® interlayer for laminated glass; CPFilms® aftermarket window films sold under the LLumar® brand and others; high-performance nylon polymers and fibers sold under brands such as Vydyne® and Wear-Dated®; and technical specialties including the Flexsys® family of chemicals for the rubber industry, Skydrol® aviation hydraulic fluid and Therminol® heat transfer fluid.  Solutia’s businesses are world leaders in each of their market segments.  With its headquarters in St. Louis, Missouri, USA, the company operates globally with approximately 6,000 employees in more than 60 locations.  More information is available at www.Solutia.com.

Source: Solutia Inc.

St. Louis

11/21/08