UPDATED 14:12 EDT / MAY 24 2016

NEWS

Report: Nokia to lay off 10,000-15,000 workers

Two years after selling its mobile business to Microsoft Corp., telecom equipment maker Nokia Corp. is reportedly bracing for another major organizational shake-up. Risto Lehtilahti, a union official from the company’s home country of Finland, revealed to Reuters today that between 10,000 and 15,000 employees could go out of work in the foreseeable future.

The figure represents a significant increase over the 2,400 planned job cuts that Nokia has officially announced so far as part of the $7 billion restructuring effort it launched at the start of the year. Last month, it revealed the goal of the push is to achieve a billion-dollar reduction in annual operating expenses by 2018. The firm didn’t go into too much detail, but it’s clear the move is related to its recently closed acquisition of French rival Alcatel-Lucent SA.

In typical fashion for a merger of two large companies from the same segment, the $17 billion deal had created a lot of overlap within Nokia’s ranks that the leadership team deemed unsustainable. The decision to lay off the redundant staff is not particularly surprising in view of how other big technology acquisition have been handled as of late. Dell Inc.’s ongoing $67 billion buyout of EMC Corp., for instance, saw the company shed thousands of workers over the past few months despite the fact the transaction is still awaiting approval. And that’s not mentioning the layoffs at the storage giant, which set aside $850 million in January for a restructuring initiative of its own.

None of the companies have provided too much information about their plans, but the 2,400 job cuts that Nokia announced to date provide some clues as to which locations will be hit the hardest. About 1,000 employees are set to be let go from its Finnish facilities, while the remaining 1,400 jobs on the chopping blocks are spread throughout France and Germany. Reuters reports that the vendor is holding talks with employee representatives in a total of 30 countries as part of the move.

Image via steinarhovland

 


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