Information technology services provider Comdisco said Wednesday that it will cut 250 jobs as part of a plan to improve future profitability and enhance strategic opportunities.
The first phase of the two-year plan, which is expected to save about $145 million annually, will include cutting the 250 jobs, or 10 percent of its workforce, effective immediately.
 |
About half of the eliminated positions are in its corporate headquarters in Rosemont, Ill., primarily in infrastructure and support departments, the company said. The remaining cuts are taking place at 19 Comdisco locations throughout North America.
As a result of this reduction, Comdisco will take a one-time charge of $6 million to $8 million in its fiscal third quarter. On an annualized basis, the first phase of the plan is expected to result in an estimated labor cost savings of about $20 million.
"During our strategic review, it has become apparent that the growth and profitability of our core leasing and services businesses have been severely challenged by a number of factors, including our cost structure,' said Norm Blake, Comdisco's chairman and CEO in a statement.
Earlier this month, the company posted sharp quarterly losses and suspended its dividend after being hurt by the weakened tech sector and trouble in the telecommunications industry.
Shares of Comdisco closed Tuesday at $2.71 per share, off a 52-week high of $33.38, up from a year low of $1.10.
Copyright 2000 Reuters Limited. All rights reserved.
Republication or redistribution of Reuters content, including by framing or similar means, is expressly prohibited without the prior written consent of Reuters.
Reuters shall be not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.
|
10 Challenges That HP Wants Partners To Tackle Right Now CRN speaks with HP's business unit chiefs to get a sense of where they'd like partners to focus in the coming year, as well as how CEO Meg Whitman is making a difference. |
|
VAR500: IBM Strikes Deal With Ukraine Bank; HP Bolsters Health-Care Practice CRN VAR500 solution providers win health-care contracts, work on European banking solution, create a platform for microlending, sharing info on cloud computing and more. |
|
Five Companies That Dropped The Ball This Week For the week ending Feb. 3, CRN looks at five companies that were either asleep at the wheel or just didn't make good decisions. |
 More
Slide Shows |
- Weathering The Storm
- IBM Inks $30M S/390 Deal With Comdisco
- Despite Slowdown, VCs Stay Active
- How To Protect Datacenters
- Understanding Unix
- Cognizant Sales Soar, Exec Promotions Follow
- VAR500 Company EPAM Systems: IPO Update
- The Daily App: Scan To PDF Free For Android
- Appcelerator Extends Mobile App Dev Reach With Cocoafish Buy
- Comdisco Chapter 11 Plan, Disclosure Filed With SEC
- Comdisco Sells Healthcare Assets For $165M
