update EMC plans to cut 1,350 jobs this year -- 100 more employees than it earlier expected -- to consolidate operations that have sprawled after a three-year acquisition spree.
The storage and software company announced a consolidation plan in November, in which it said it would cut 1,250 positions and take a charge of US$150 million to US$175 million to pay for the restructuring. Its final consolidation plan, approved by EMC management on December 29 and outlined in a regulatory filing Friday, calls for the higher job cuts.
The plan is "designed to deliver a more unified experience to customers" and to improve the company's efficiency, EMC said in the regulatory filing.
Over the past three years, EMC has bought 21 companies, including the US$2.1 billion purchase of RSA Security in June 2006.
The final plan's cost will fall at the high end of the predicted range: US$175 million, or 6 cents per share, EMC said. The company will take the charge in financial results for the fourth quarter of 2006.
The layoffs are expected to be complete by the end of the year and account for about US$130 million of the charge. Terminating real estate contracts and other contracts will cost about US$15 million, and EMC will take a write-off of about US$30 million to cover assets no longer expected to produce any benefits, the company said.
Australian employees are not expected to be affected by the layoffs, according to a local EMC spokesperson. There are no reductions planned at VMware, and the cuts are expected to have relatively little impact on RSA and Network Intelligence employees, the spokesperson added.
Just to show how wrong the local EMC spokesman was, nobody in the Australian IT press seems to have noted the fact that EMC laid off 40 people from the local RSA DSG group on Thursday, 21st Feb.
This division was responsible for support for RSA's BSAFE cryptography products as well as the new Key Manager product. These layoffs will have an impact in RSA's ability to support these products. The jobs were exported to EMC's workers in Hyderabad, India.