Pandatel initiates restructuring

December 20, 2005 Hamburg, Germany -- Pandatel AG, a publicly traded company at the German Prime Standard market and a specialist in providing Ethernet and optical networking products, announced that it has reached an agreement with the German Worker's Council regarding operations restructuring.

Dec 20th, 2005

December 20, 2005 Hamburg, Germany -- Pandatel AG, a publicly traded company at the German Prime Standard market and a specialist in providing Ethernet and optical networking products, announced that it has reached an agreement with the German Worker's Council regarding operations restructuring.

According to a press release, as part of the restructuring plan, Pandatel will consolidate its German operations from three locations to one, in order to decrease operating costs. Upon shareholder approval, the company will move its headquarters from Hamburg to Hanover, where its main team of engineers works, focused on Ethernet products. The company's current headquarters in Hamburg will be shut down and key engineers will be offered work in Hanover as part of the company's R&D team. The company's current Lightmaze division in Eisingen (Würzburg) will also be shut down with key engineers transferred to Hanover, in order to continue development and support of the company's YUMIX line of optical networking products.

Upon the completion of the restructuring, the total number of Pandatel employees in Germany will decrease in number from 100 to about 30. The company says the layoff especially affects its production unit, as well as its sales and administration operations.

The company says its new R&D team will now focus its efforts on developing next generation Ethernet and optical products, with some development activities as well as manufacturing to be outsourced to Dowslake Microsystems. Pandatel and Dowslake are currently working on a merger plan, which was announced on November 21, 2005.

Other details of the restructuring plan include product consolidation and formation of a new management team. Currently, Pandatel says it has upwards of thousands of products or variants to be produced, with a large number of these selling at extremely low volume. After restructuring, the company says it will consolidate to three product categories: "Optical Networking," "Ethernet & Multi-service Over SDH/SONET," and "Last Mile/TDM Access". The company says its products will be migrated to circuit platforms to decrease manufacturing burdens and to improve cost and delivery efficiencies. The company says its total number of product platforms will be decreased to less than 40.

Also in the press release, Pandatel announced its new management team. Andreas Hennig, who is currently head of R&D for the company's Hanover team, will be appointed vice president of R&D to lead overall R&D efforts. Munther Jadallah, currently managing director of the company's Asia-Pacific operation, will be appointed vice president of sales and marketing. Dr. Marc Ruelaender, currently manager of quality management and technical service at the company's Lightmaze division, will be appointed director of quality management and business processes.

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