Restructuring and Other Charges, Net

3 Months Ended

Mar. 31, 2021

Restructuring and Related Activities [Abstract]

Restructuring and Other Charges, Net

RESTRUCTURING AND OTHER CHARGES, NET

Restructuring and other charges primarily consist of separation costs for employees including severance, outplacement and other employee benefit costs ("Severance"), charges related to the write-down of fixed assets of plants to be closed ("Fixed asset write-down") and all other related restructuring ("Other") costs. All restructuring and other charges, net are separately stated on the Consolidated Statement of (Loss) Income and Comprehensive Loss.

Frutarom Integration Initiative

In connection with the acquisition of Frutarom, the Company has been executing an integration plan that, among other initiatives, seeks to optimize its manufacturing network (the "Frutarom Integration Initiative"). As part of the Frutarom Integration Initiative, the Company expects to close approximately 35 manufacturing sites with most of the closures targeted to occur by the end of 2022. Between 2019 and 2020, the Company completed the closure of 21 sites. During the three months ended March 31, 2021, the Company completed the closure of one site in North America. Since the inception of the initiative through March 31, 2021, the Company has closed 22 sites and expensed total costs of approximately $27 million. Total costs for the program are expected to be approximately $60 million including cash and non-cash items through 2022.

2019 Severance Program

During the year ended December 31, 2019, the Company incurred severance charges related to approximately 190 headcount reductions, excluding those previously mentioned under the Frutarom Integration Initiative. The headcount reductions primarily related to the Scent business unit with additional amounts related to headcount reductions in all business units associated with the establishment of a new shared service center in Europe. Since the inception of the program, the Company has expensed approximately $21 million to date. As of March 31, 2021, the program is largely completed.

Other Restructuring Charges

For the three months ended March 31, 2021, the Company incurred approximately $4 million of severance charges related to executives separating from the Company.

Changes in Restructuring Liabilities

Changes in restructuring liabilities by program during the three months ended March 31, 2021 were as follows:

(DOLLARS IN MILLIONS)	Balance at December 31, 2020		Additional Charges (Reversals), Net		Impact of N&B Merger		Balance at March 31, 2021
Frutarom Integration Initiative
Severance	$	3	$	—	$	—	$	3
Other(1)	3		—		—		3
2019 Severance Plan
Severance	6		—		—		6
Other Restructuring Charges
Severance	2		4		—		6
N&B Restructuring Liabilities(2)	—		—		4		4
Total restructuring	$	14	$	4	$	4	$	22

_______________________ 

(1)Other includes supplier contract termination costs, consulting and advisory fees.

(2)Restructuring liabilities assumed as a result of the Merger with N&B.

Charges by Segment

The following table summarizes the total amount of costs incurred in connection with these restructuring programs by segment:

	Three Months Ended March 31,
(DOLLARS IN MILLIONS)	2021		2020
Nourish	$	—	$	5
Shared IT & Corporate Costs	4		—
Total Restructuring and other charges, net	$	4	$	5