On the heels of unveiling plans for their mega merger into a $130 million conglomerate before splitting into three parts, US chemical giants Dow and DuPont appear to be releasing the bad news in small doses to staff and local communities where production facilities are located.

DuPont has taken the first step, announcing this week that, with immediate effect, it will begin paring down its 54,000-member workforce by around a tenth. It also said it would close a US nylon manufacturing facility at Chattanooga, Tennessee and transfer its shrunken operations there to another regional site at Richmond, Virginia.

Most of the production complex at Chattanooga no longer belongs to DuPont, having been sold more than 10 years ago to Koch Industries, which operates most of the plants under its subsidiary Invista, and Turkey’s Kordsa, a manufacturer of nylon tire cord.

The moves are part of a $700 million global cost saving and restructuring plan that will be implemented parallel to the merger proceedings. It seems likely that most of the puzzle pieces will be in place by mid-year, when the combined DowDuPont is due to start trading.

DuPont said the restructuring “further simplifies the company's structure into fewer, larger businesses with integrated functions, leading to sustainable cost reductions, faster decision-making and closer connections to end markets.”

The group will take a pretax charge to earnings of around $780 million, which would include $650 million in employee separation costs and some $130 million in asset-related charges and contract terminations.

Dow’s board of directors meanwhile has published a statement expressing support for the union with DuPont, taking pains to say that the vote for the merger was unanimous and thus included the two directors designated by Dow’s activist shareholder fund Third Point, Raymond Milchovic and Steve Miller.

The fund’s chief executive Daniel Loeb, however, took umbrage at the designation of his nemesis Andrew Liveris as executive chairman and called for his removal. According to the US newspaper Wall Street Journal (WSJ), Loeb also questioned the timing of the merger announcement, a day before the end of a standstill agreement with Dow prohibiting him from criticizing the company or acquiring fresh stock.

Liveris should not have any role in the post-merger entity, WSJ quotes Loeb as saying. Giving him the title of executive chairman, the fund manager reportedly said, “is a slap and an insult to Dow shareholders.”