Seagate To Shed Almost 3,000 Jobs And Will Cut Salaries

Seagate Technology 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 made in a filing with U.S. Securities and Exchange Commission, come two days after Seagate (STX) said it would lay off about 10% of its U.S.-based workforce. The company also replaced CEO 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 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%, would lower by 20% the salaries of senior vice presidents. Vice-president 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.

Source : CNN Money
[tags : recession bankrupt collapse retrenchment financial news collapse stagnation economic slowdown financial collapse world recession global recession layoff job cut]