UPDATE 1-Nokia Siemens axes 3,500 in Latin America deal exit

Wed Feb 29, 2012 4:49pm IST

Stocks

   

* Cuts in addition to 17,000 job losses announced last year

* No cost to company in pulling plug on support deal (Adds comments, background)

By Tarmo Virki

BARCELONA, Feb 29 (Reuters) - Nokia Siemens Networks has cut 3,500 jobs by exiting a large services deal in Latin America, part of the telecom equipment vendor's strategy of focusing on higher-margin businesses, its chief executive told Reuters.

Rajeev Suri said the latest move would be in addition to the 17,000 job cuts -- almost a quarter of the group's workforce -- announced in November.

The contract it is dropping involves low-end installations and support, and the exit resulted in no cost to the company, Suri said. "It was mutually agreed and the contract was handed back to the client," he said in an interview.

Formed by Nokia and Siemens in 2007, Nokia Siemens has struggled for profitability due to pricing pressure from Chinese rivals and Sweden's Ericsson.

Chairman Jesper Ovesen told Reuters this month the company would be more selective on deals and prioritise profitability.

Suri said it had decided where half the 17,000 job cuts would be made, and has begun the process in 55 countries.

Asked about business in India, where the Supreme Court has ordered telecoms licences issued in a 2008 sale to be revoked, Suri acknowledged the impact on capital spending in the industry.

"Capex in India is down a lot," Suri said, adding Nokia Siemens was not affected as it had business there before 2008. (Editing by David Hulmes)

Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

REUTERS SHOWCASE

Diwali Sales

Diwali Sales

Gold sales jump about 20 pct for Diwali - trade body  Full Article 

World Bank Rival

World Bank Rival

Three major nations absent as China launches W.Bank rival in Asia  Full Article 

Wal-Mart India

Wal-Mart India

Murali Lanka appointed as Wal-Mart India operations chief  Full Article 

Microsoft Earnings

Microsoft Earnings

Microsoft sales beat Street hopes, cloud profits up.  Full Article 

Special Report

Special Report

Why Madrid's poor fear Goldman Sachs and Blackstone  Full Article 

U.S. Economy

U.S. Economy

Spectre of no-inflation world looms over Fed's return to normal  Full Article 

Insider Trading

Insider Trading

Rengan Rajaratnam, SEC to settle civil insider trading charge.  Full Article 

Market Watch

Market Watch

Betting on the beaten up? Investors pin hopes on stocks in Europe, Japan.  Full Article 

India Insight

India Insight

Kalki Koechlin on her role as a disabled girl in “Margarita, With a Straw”  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage