Enterasys slashes headcount by 30%
Big cost cutting
Enterasys Networks Inc is to lay off about 730 people, 30% of its workforce, as the company executes a restructuring plan aimed at saving costs. The layoffs follow last week's management shakeout, which saw the resignation of its chairman, CEO and president, as well as vice chairman and EVP of worldwide marketing, and the COO.
"The cost cutting initiatives are an important first step designed to achieve cash break even as soon as possible," said William O'Brien, who is acting as interim CEO until the board finds a replacement. "We are continuously evaluating additional business improvement opportunities to increase sales effectiveness and reduce costs."
Enterasys, which makes internet routing and security equipment, is currently the target of a regulatory investigation by the US Securities and Exchange Commission, which is looking into some of its spin-off companies.
The probe is believed to relate to accounting issues the company uncovered in its Asia-Pacific business. These issues are related to Enterasys's recent warning that first-quarter revenue will be less than it initially expected.
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