Electronics Production | November 06, 2008
ST-NXP Wireless cuts 500 jobs
ST-NXP Wireless has announced that substantial changes in the global markets and in the needs of its customers have moved the Company to accelerate the capturing of synergies it identified in some countries when it launched and to adapt its global organization to the new market realities.
In announcing the deal to create ST-NXP Wireless in April 2008, the parent companies, STMicroelectronics and NXP, highlighted the strong complementary nature of the businesses, while also recognizing a number of opportunities for synergies. With today’s market outlook appearing quite different than it did just a few months ago, ST-NXP Wireless is taking necessary action to adapt its R&D resources and cost structure to the new business conditions in the industry. To rationalize its product portfolio and development efforts, ST-NXP Wireless today announced the plan to reduce its global workforce by about 500 people, including subcontractors, from the current total of more than 7500 people. This headcount reduction and the progressive termination of transitional services purchased from its non-consolidating parent are targeting, under an accelerated timeline, the approximately $250 million of cost savings anticipated at the time of the merger’s announcement. Restructuring charges are anticipated in the range of $50 million, mostly accrued in ST-NXP Wireless and ST’s consolidated balance sheet at the end of September 2008.