American Power Conversion Streamlines Operations in Ireland

July 05, 2006 by Jeff Shepard

American Power Conversion Corp. announced initiatives to reduce costs, improve efficiencies and locate operations closer to the customer by streamlining its operations in Ireland.

APC's plans call for the consolidation of Irish manufacturing operations in its Castlebar, Ireland facility and the redeployment of certain customer-facing positions to locations in the Europe, Middle East and Africa region in closer proximity to customers. The company currently intends to retain select sales, information technology, research and development and business support functions in its existing Galway, Ireland facility. APC will begin discussions with its workforce in Ireland with the objective of reducing approximately 200 to 250 positions within Ireland, primarily in the manufacturing, operations and customer support areas.

"In an effort to improve our competitiveness as well as become increasingly customer-centric, APC has been actively working to reduce operational costs and improve company productivity through the transition of production to lower cost areas as well as the deployment of customer-facing activities closer to the customer," explained Rodger B. Dowdell, Jr., APC president and chief executive officer. "The redeployment and the reduction of certain positions in Ireland is the direct result of this strategy, and while this was a very difficult decision to make, it better positions APC both financially and competitively. We will continue to work to better align manufacturing capacity with demand and optimize resource location to maximize customer satisfaction globally."

The estimated range of costs in connection with this plan is approximately $4.0 million to $5.0 million, consisting primarily of one-time employee severance costs, which will be recognized in the third quarter 2006. The company anticipates completing the plan in the first quarter of 2007 and that all of the expected costs will result in future cash expenditures.