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HP to Eliminate 24,600 JobsPOSTED September 16, 2008 PALO ALTO -- HP announced it will cut up to 24,600 jobs following its acquisition of technology services company EDS. EDS was officially acquired by HP in August for $13.9 billion in cash. HP intends to implement a restructuring program for the EDS business group that will better align the combined company's overall structure and efficiency with the operating model that HP has successfully implemented in recent years. In addition to making changes to its global workforce to better serve its services customers, HP has identified overlapping areas in corporate overhead functions, such as real estate, IT and procurement. The restructuring program will take place over three years and includes a workforce reduction that will streamline the combined company's services businesses. Workforce reduction plans will vary by country, based on local legal requirements and consultation with works councils and employee representatives, as appropriate. Approximately 7.5 percent of the combined company's workforce, or about 24,600 employees, will be affected over the course of the program, with nearly half of the reductions occurring in the United States. HP will provide employees affected by this restructuring program with severance packages, counseling and job placement services. HP said it expects to replace roughly half of these positions over the next three years to create a global workforce that has the right blend of services delivery capabilities to address the diversity of its markets and customers worldwide. Once completed, the restructuring program is expected to result in annual cost savings of approximately $1.8 billion. These savings are net of reinvestments in areas including sales coverage, delivery optimization and emerging markets. HP will be recording a charge of $1.7 billion in the fourth
quarter of fiscal 2008 relating to the restructuring program. © Copyright SVDaily.com |
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