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HP to shed 24,600 jobs

Renai LeMay ZDNet Australia

Published: 16 Sep 2008 08:22 BST

Technology giant HP said on Monday that it would cut around 24,600 jobs, or 7.5 percent of its total workforce following its $13.9bn (£7.7bn) acquisition of Texan IT services firm EDS.

In a statement, the company said the "restructuring programme" would take place over the next three years, with the staff reduction to vary by country, "based on local legal requirements and consultation with work councils and employee representatives".

However, HP said it also expects to replace roughly half of the positions over the same period, to create a global workforce with the right blend of services-delivery capabilities.

Nearly half of the job cuts will occur in the US.

In general, HP said the firm wanted to better align the combined company's structure with the operating model it had used over recent years. "In addition to making changes to its global workforce to better serve its services customers, HP has identified synergies in corporate overhead functions, such as real estate, IT and procurement," the company said.

The restructuring programme is expected to result in annual cost savings of around $1.8bn, with that amount taking into account some reinvestment. The company will take a charge of $1.7bn related to the programme.

Credit: HP/EDS to cut 24,600 jobs from ZDNet Australia