ST-NXP Wireless, offer ideal solutions for cellular modems, multimedia, and connectivity, have announced that substantial changes in the global markets and in the needs of customers have moved the Company to accelerate the capturing of synergies it identified in some countries when it launched and to adapt the global organisation to the new market realities.
In announcing the deal to create ST-NXP Wireless, the parent companies, ST Microelectronics and NXP, highlighted the strong complementary nature of the businesses, while also recognising a number of opportunities for synergies.
With the current market outlook appearing quite different than it did just a few months ago, ST-NXP Wireless is taking necessary action to adapt their R and D resources and cost structure to the new business conditions in the industry.
To rationalise their product portfolio and development efforts, ST-NXP Wireless today announced the plan to reduce the global workforce by about 500 people, including subcontractors, from the current total of more than 7500 people.
This headcount reduction and the progressive termination of transitional services purchased from their non-consolidating parent are targeting, under an accelerated timeline, the approximately $250 million of cost savings anticipated at the time of the merger’s announcement. Restructuring charges are anticipated in the range of $50 million, mostly accrued in ST-NXP Wireless and ST’s consolidated balance sheet at the end of September 2008.