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Electronics Production | January 25, 2012

Incap to close Helsinki factory

Incap has completed co-operative negotiations in Incap's Helsinki factory. The factory will be closed down and production transferred to the Kuressaare factory.
After evaluation of different alternatives for adjustment of operations and improvement of profitability Incap has decided to close down the Helsinki factory and will transfer the production to the company's other factories. The decision means that the employment contracts of 8 white-collars and 48 blue-collars will be terminated gradually during winter and spring. The close-down of the factory and the production transfer will have no effect on customer relationships or deliveries.

According to preliminary estimates the main part of the factory's production will end by autumn 2012. The sheet-metal manufacturing will be transferred partly to Incap's factory in Vaasa and partly to subcontractors. The final assembly will be transferred to the Kuressaare factory.

Incap estimates that the close-down of the factory will bring annual savings of about EUR 1.6 million in fixed costs. The Helsinki factory is operating in leased premises.

Says Mr Sami Mykkänen, President and CEO of Incap Group: "We have already for a longer time searched for a solution to improve the profitability of the Helsinki factory. Negotiations on the sale of the sheet-metal manufacturing business were continued until the end of last year but they did not lead to any satisfying result. Keeping up the competitive edge in sheet-metal manufacturing in Helsinki would have meant remarkable investments in machinery during the next few years, and these were considered to be inappropriate in the present market situation."

"Close-down of the factory is a heavy measure for the personnel but it is necessary for the company's future. Centralisation of the manufacturing operations in Kuressaare and Vaasa plants increases the capacity utilisation rate and lowers the fixed costs. Decrease in production costs enhances also our customers' competitive edge. In addition, the centralisation gives us better means for developing the company's operations further."

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