Nokia SiemensUpdates on Job Cuts Program - to Close German Facility

Nokia Siemens Networks says that it has completed the preliminary planning process to identify the proposed remaining job cuts which is has previously announced. As a result, the company is now starting the process of sharing these preliminary plans with employees and employee representatives in Finland and Germany.

When the plan to form Nokia Siemens Networks was announced on June 19, 2006, Nokia and Siemens said that they expected the merger to result in a headcount adjustment in the range of 10-15 percent of the global workforce. In May of 2007, Nokia Siemens Networks confirmed that it expected the adjustment to remain within that range, at approximately 9,000 employees. To date, the company has made some 6,000 people redundant and aims to eventually lose some 9,000 staff.

"From the very start Nokia Siemens Networks has focused on building a strong, competitive company and these planned actions are an important step to help us reach that goal," said Simon Beresford-Wylie, chief executive officer of Nokia Siemens Networks. "With the successful completion of these plans, we will have the vast majority of the synergy-related headcount reductions completed and we can then start to put this chapter of our history behind us and focus on creating a world-class company."

The proposed headcount adjustments are a result of merger-related synergies, including changes to the product portfolio; site optimization; streamlining of various functions; strategic, long-term R&D and workforce balancing; and other factors designed to build a competitive Nokia Siemens Networks.

"We have now completed the preliminary planning necessary to identify the specific areas where we have additional synergy-related reduction needs," said Bosco Novak, head of human resources at Nokia Siemens Networks. "It is our goal to engage constructively with employee representatives in Finland, Germany and other countries to quickly and fairly achieve these needed changes so we are able to remove the ongoing uncertainty that our employees have about synergy-related headcount reductions."

In May 2007, Nokia Siemens Networks announced that it expected a reduction of 1,500-1,700 employees in Finland, not including the transfer of employees to partners. To date, the company has achieved approximately 500 reductions through its active restructuring process, with substantially all through the use of voluntary severance packages. Headcount in Finland has been further reduced through natural attrition and the transfer of employees to partners.

Nokia Siemens Networks is now proposing a maximum reduction need in the range of 750 employees in Finland, bringing the planned total reductions through active restructuring to less than 1,300. At the completion of the planned synergy-related headcount restructuring activities, Nokia Siemens Networks expects to have in the range of 7,000 employees in Finland, from an initial base of approximately 9,200.

In Germany, Nokia Siemens Networks announced in May 2007 that it was targeting active reductions in the range of 2,800-2,900 and reached agreement with employee representatives on an initial reduction of 2,300, which was completed on May 28, 2008. Since then, a further assessment of the business impact of merger-related synergy requirements, corresponding organizational and portfolio changes, and continued challenging telecommunications market conditions have shown the need for further reductions, primarily in the companyÃ's Munich Hofmannstrasse site.

As a result, the company has decided to close its Hofmannstrasse site.

The proposed reduction will affect approximately 500 employees and is planned to be completed by the end of October 2009. The companyÃ's information technology organization located at Tölzer Strasse in Munich will not be impacted as that facility is subject to a long-planned separation from the Hofmannstrasse site.

The company also announced separately an agreement for its manufacturing site in Durach, Germany to be purchased in a management buy-out, led by the current leadership of the facility. That agreement will result in the transfer of around 500 employees. At the completion of the planned headcount restructuring and employee transfer activities, Nokia Siemens Networks expects to have in the range of 10,000 employees in Germany, from an initial base of approximately 13,000.

"Once this planned action is successfully completed, we will have achieved the vast majority of the synergy-related headcount reductions needed in Germany," said Christoph Caselitz, chief market operations officer of Nokia Siemens Networks. "Where possible, we have sought to lower our headcount through transfer to trusted partners, such as the management buy-out in Durach that we announced today, as we believe that is the best way to preserve jobs. We also added a large number of employees in Germany when we assumed control of Vivento Technical Services from Deutsche Telekom, and we continue to look for similar growth opportunities in the country."

In addition to Finland and Germany, the company also announced the planned reduction of approximately 50 employees in Egypt related to the closure of a small manufacturing facility and in the range of 20 employees in the United States related to the ramp down of a small site over the course of 2009.

Posted to the site on 11th November 2008