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CEO Bart Sap cites complex transition to electric mobility

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Cost-cutting measures to save 40 million euros by 2025

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Shares rise after early fall

(Adds analyst, paragraph 4, shares, paragraph 5, detail on cost

cutting measures, final three paragraphs)

By Nathan Vifflin

Nov 6 (Reuters) - Metals recycler and battery materials

producer Umicore will pause construction of a battery

materials plant in Canada, it said on Wednesday.

The Belgian-based group launched a review of its business in

July, and said it had postponed "large scale" investments in an

unspecified battery recycling plant in Europe, as well as for

one in the municipality of Loyalist, Canada.

"Umicore is navigating a challenging environment where we

feel the impact of the complex transitioning of the automotive

industry towards electric mobility. Serving our North American

customers out of Korea is now clearly the most effective use of

our assets," CEO Bart Sap said in a statement.

Analysts of Jefferies welcomed the decision, saying it

rationalises plans to improve return on capital for its

loss-making battery material business.

By 0900 GMT, Umicore shares were up 1.5%, having recovered

from a 2% drop at the market open.

Umicore, which makes catalytic converters as well as

providing battery materials for automakers, said ‍it had not

drawn on incentives provided by the Canadian government, and

that, if the construction resumes, it would access them under

same conditions, including employment commitments.

Umicore also gave detail on the cost-cutting measures it

announced in July, saying they would contribute 40 million euros

($42.94 million) of savings in 2025.

They would also affect around 260 positions, 100 of which

are in Belgium, said the company that has 12,000 employees in

all.

It said it had begun consultations with trade unions, and

intended to resize the workforce of its battery materials

division predominantly in its Jiangmen, China production plant,

while also cutting R&D activities located in Hørsholm Denmark.

($1 = 0.9316 euros)