CA to shed 800 workers
$70m a year savings
Computer Associates is to shed 800 staff worldwide, in $70m-a-year cost-cutting moves. The restructure will affect nearly all departments, beginning with a hunt for marketing efficiencies and improved productivity in the company's development business, the software firm said today.
It will also examine its product portfolio, dropping the less profitable lines.
The announcement comes just days after CA settled with the Department of Justice and SEC over a $2.2bn accounting fraud, which saw sales booked too early as revenue. It is paying $225m to shareholders for "losses caused by the misconduct of certain former company executives".
CEO Kenneth Cron said it was time for the company to move forward. To do this, it needs to "effectively leverage these strengths [CA's technology, its customer base and its balance sheet] and realign our investments with the Company's strategic growth opportunities".
The redundancies will cost around $40m in severance and associated benefits, and the majority of the workforce reductions will be completed by the end of October.
CA says it remains strong financially, but a bout of slimming will position it better for growth. ®