Sipex Announces Reduction of Workforce
Sipex Corp. (Billerica, MA) announced that it will be reducing its workforce by approximately 15 percent. The reduction is primarily focused on manufacturing operations and administrative positions. In addition, the company will be shutting down its manufacturing operations for some period in the company's third quarter.
The additional charges of approximately $500,000 for severance will be taken in the company's second quarter of 2001. The expected savings associated with the reduction in workforce are approximately $1.0 million per quarter. In addition to the cost reduction, Sipex expects a significant reduction in wafers run at outside foundries, resulting in an approximate 30-percent increase in internal production, or a savings of $3.0 million per quarter.
"Although we have been encouraged by positive signs for our new products in the telecommunications and optical storage business, the continued softness and lack of visibility within our core business has led us to take stronger actions to manage our costs. We expect that these steps will enable us to align our costs to the realities of the current situations," commented James Donegan, Sipex chairman and CEO.