UPDATE:Seagate To Shed Almost 3,000 Jobs, Will Cut Salaries
14 Janeiro 2009 - 5:52PM
Dow Jones News
(Updates with details of layoffs)
By Rex Crum
Seagate Technology Inc. (STX) said Wednesday it would cut about
6% of its worldwide workforce and lower the salaries of its top
officers by as much as 25% as part of a restructuring plan by the
world's top maker of computer hard-disk drives.
The layoffs and salary cuts, which were announced in a filing
with the U.S. Securities and Exchange Commission, come two days
after Seagate said it would lay off about 10% of its U.S.-based
workforce. The company also replaced Chief Executive Bill Watkins
and President Dave Wickersham with company board Chairman Stephen
Luczo.
Seagate said the job cuts announced Wednesday were included in
the 10% U.S. layoff figure. The company says about 2,950 workers
will be laid off in total.
According to the filing, Seagate estimates the restructuring to
be largely completed by the end of March and will result in the
company taking a pre-tax charge of $90 million and would save the
company about $130 million annually.
Seagate also said it would cut the salary of Luczo and "named
executive officers and executive vice presidents" by 25% and would
lower by 20% the salaries of senior vice presidents. Vice
presidents will see salary cuts of 15% and other management, sales,
supervisors and professional employees will get a 10% cut. Seagate
said the salary cuts should come to $80 million a year.
After the filing was made, Needham & Co. analyst Richard
Kugele said in a research note that he expects more job cuts at
Seagate later this year. Kugele left his strong buy rating intact
only because he felt Seagate's stock is properly valued at the
present time.
Seagate shares fell 19 cents, or more than 4%, to $4.39 in
afternoon trading.
-By Rex Crum, 415-439-6400; AskNewswires@dowjones.com
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