Seagate cutting 6 pct of workforce, salaries
SAN FRANCISCO (Reuters) - Seagate Technology disclosed more details of its restructuring plan Wednesday, including a global head count reduction of around 6 percent or 2,950 people, as well as wide-ranging salary cuts.
The layoff total includes the 10 percent cut of the company's U.S. workforce previously announced by the world's largest maker of hard disk drives.
Details of the restructuring were included in a regulatory filing with the Securities and Exchange Commission.
On Monday, the company replaced Chief Executive Bill Watkins with Chairman Stephen Luczo.
Seagate expects the restructuring to save it roughly $130 million a year. The company sees pretax charges of $90 million, which it plans to take in the December 2008 quarter.
Seagate also plans to institute a 25 percent pay cut for its CEO, "named executive officers" and executive vice presidents, along with a 20 percent cut for senior vice presidents and a 15 percent cut for vice presidents.
In addition, it will reduce the salaries of management, sales, supervisors and professional employees by 10 percent.
The company expects those salary reductions, which will become effective in February, to save $80 million a year.
The hard disk drive industry, dominated by Seagate and main rival Western Digital Corp, has been severely affected by the economic downturn as demand for PCs has dried up.
Seagate's shares fell 9 cents or 2 percent to $4.49 on the Nasdaq around midday Wednesday, off an earlier low at $4.27. (Reporting by Gabriel Madway, editing by Matthew Lewis)