In order to align its expenses with reduced spending by major communications carriers, Tellabs (Nasdaq: TLAB) plans to reduce its worldwide work force by about 1,000 people, close two facilities and further cut operating expenses. Tellabs plans to lay off 950 employees, and 50 employees have voluntarily accepted the company's early retirement offer.
Tellabs plans to close a manufacturing facility in Drogheda, Ireland, and consolidate that work into other manufacturing facilities in Shannon, Ireland, and Espoo, Finland. Tellabs also will discontinue plans to open an office building in Chelmsford, Mass.
These steps are designed to meet Tellabs' target of a further five percent reduction in operating expenses by the fourth quarter of 2001. In total, these and earlier actions are expected to save the company approximately $120 million annually. Tellabs expects to take a one-time restructuring charge of about $50 million against third-quarter 2001 earnings.
Richard C. Notebaert, president and chief executive officer of Tellabs, cites less work due to customers' restricted spending.
Tellabs design, build and service optical networking, broadband access and voice-quality enhancement equipment. For more information, visit www.tellabs.com.