French telecom equipment firm Alcatel announced late on Wednesday that over 3,000 staff would be made redundant by the middle of next year, including hundreds from its UK operations.
The jobs will be lost from Alcatel's undersea and optical fibre divisions, which together employ around 9,300 people. Like other equipment providers in the telecommunications industry, Alcatel has suffered from a big drop in orders. It warned back in July that the slump in the telecom sector could last until the end of 2002.
The company has seen its share price fall from a high of 80 euros to around 12 euros, a better performance than that achieved by fellow equipment maker Marconi. In afternoon trading on Thursday Alcatel shares were changing hands for 11.7 euros each.
Staff at Alcatel's operations at Greenwich in London will be hit by the redundancies. Around 650 jobs will be lost from the plant, which manufactures underwater cables. Recently Alcatel slashed 2,500 jobs from its US workforce. So far this year it has announced a total of 20,000 redundancies.
Analysts at Credit Suisse First Boston warned that it thought it unlikely that Alcatel would be able to reach its debt target of 4.5bn euros by the end of 2001, and predicted that the company could see its credit rating downgraded.
There was more bad news for the UK's tech industry on Thursday with the news that New York-based Corning was planning to close a factory in North Wales. Over 430 will be lost from the Deeside plant. Corning, the world's biggest manufacturer of fibre-optic cables, blamed falling demand for the closure.
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