Nokia Alcatel-Lucent merger onsets employment cuts

Nokia Alcatel-Lucent merger onsets employment cuts

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WEDNESDAY: In order to save money after merging with Alcatel-Lucent, telecom equipment giant, Nokia announced to open discourse with staff representatives based in around 30 countries regarding employment cuts.

Nokia was looking ahead to experience 4300 job cuts within Euro-zone, including 411 in France, as what French Labor unions have stated. On overviewing estimates in Finland: the state is probably prone to lose approx. 1300 jobs, i.e. 20% staff. For rest of the countries, Nokia could not disclose the exact percentage.

UPDATE: By the start of year 2018, Nokia plans to save an estimate worth US$ 1.02 billion/year (i.e. 900 million Euros). The acquisition expected by Nokia might cut operating costs at US$ 969 (€900 million) by year 2019.

It further stated that the headcount reductions are likely to take place between years 2016 to 2018.

“Reductions will come largely in areas where there are overlaps, such as research and development, regional and sales organizations as well as corporate functions.”

“When we announced the acquisition of Alcatel-Lucent we made a commitment to deliver EUR 900 million in synergies — and that commitment has not changed.” – Nokia’s CEO, Rajeev Suri

Alcatel-Lucent acquisition was a logical move by Nokia as its portfolio is likely getting diversified between fixed and mobile telecom equipment – giving it another boost against its growing rivals like Huawei.

INSIGHT: Nokia had bought 50% network activities from German Siemens, in 2013. Ahead to that, it divested its mobile phone business, in 2014 – despite of being top on mobile market platform – and, it sold its mapping unit and gripped Alcatel-Lucent, in 2015.

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Zac Berry is presently a full time editor at Market Morning. He covers the M&As and follows live market commentary. Before joining Markets Morning, Zac Berry worked with a start-up, where he worked in the capacity of a Team Leader tracking company events and results. Born in the U.A.E, he spent most of his growing up years in Dubai. Currently, he resides in U.S. and is pursuing his charter in Accountancy.

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