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Restructuring, Swedish Engineering group, Sandvik shed 1500 jobs

Wednesday, 28 November 2012
To show that the market is not working well, Sandvik, the Swedish an engineering group in tooling, materials technology, mining and construction is now working to save Skr1 billion. This means that some 1500 people will be removed from the company's operation when it launches its most ambitious savings program.

According to the company, its strategy presented in September 2011 laid out the path toward a strengthened market leadership position based on four cornerstones: AMBITION, SPEED, FOCUS and GLOBAL/LOCAL.

This strategy, the company adds has been implemented successfully and according to plan and a recent strategic reviews revealed additional potential for structural improvements in several business areas.

So over Skr1billion is to be saves from its annual costs, and it should be fully operational by the end of next year, the management notified in a press release.
"A reduction of 650 employees globally has been deemed necessary, including the closure of the units in North Bay, Canada, and Rocklea, Australia," the compaby writes in a press release.

"Third-party contracts with more than 350 individuals will be terminated. Charges of a nonrecurring nature are estimated at Skr175 million and will be recognized in the fourth quarter 2012, with a further Skr175 million recognized in 2013," continues the company in the press release

At Sandvik Machining Solutions, opportunities to generate economies of scale have been identified. The distribution center in Kentucky, US, will incorporate Seco Tools products. Consequently, the Seco Tools US distribution center in Troy will be closed.

Combined with other initiatives across the business area, including a headcount reduction in Fagersta, Sweden, this is expected to result in a structural reduction in costs of Skr150 million. The nonrecurring charges associated with these initiatives are expected to impact earnings by just under Skr100 million in the fourth quarter 2012 and by Skr200 million in 2013.
Details about changes in Sandvik and the subsequent job losses could be found here in this company press release.
Scancomark.com Team

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