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1700 workers may leave ST - Ericsson

Monday, 23 April 2012
ST- Ericsson, jointly owned by Ericsson, aiming to achieve annual savings totalling approximately $320 million, equivalent to Skr2.1 billion, in new and ongoing restructuring program when they were finalized at the end of 2013.

According to a press release, this has to do with the total restructuring cost which is estimated to stand at approximately 130 -150 million dollars.

The total workforce will be reduced globally by 1,700 employees, including employees who will transfer to ST – Microelectronics as part of the partnership in research and development that the two companies have formed.

ST- Ericsson entered into partnership with the other owner, ST Microelectronics in the development of application processors.

ST- Ericsson will move its R & D activities and employees of application processors for ST Microelectronics, and then integrating application processors in platforms ModAp of smartphones, and read and surf boards under a license agreement with ST Microelectronics.

In addition, the two companies signed a commercial agreement to jointly market and offer both stand-alone processors and thin modem to a broader base of customers and applications, the press release say.

The main building blocks of the complete system solution, application processors, modems, network connections and power supplies, RF, analog and mixed signals, will be developed either directly or through partnerships and alliances to reduce and optimize the operation of R & D, the press release said further.

The company will continue to develop IP-modem, which is a distinctive competitive advantage, selling thin modem and possibly license the IP modem to third parties.

ST-Ericsson also has the intention to reduce its selling, general and administrative expenses by about 25 percent, from 2011 onwards.

This will be achieved by streamlining business activities within the administration and in addition greatly reduce the number of positions among the highest paid members of its management.

The company will improve the performance of its research and development activities and to more quickly access the market.

The number of workplaces is to be significantly reduced. A fewer number of workplaces will be specialized by technology.
By Team

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