Friday, April 26, 2013

Suzlon’s REpower may cut up to 750 jobs

Embarking on a reorganization drive, the firm seeks to realize cost savings of around €100 mn in the 2013-14 fiscal
P.R. Sanjai
Mumbai: Wind turbine maker REpower Systems SE, the German unit of Tulsi Tanti’s Suzlon Group, on Friday said it was embarking on a reorganization drive, which will include lay-offs, to become leaner, more efficient and competitive.
In a statement, the company said it was seeking to realize cost savings of around €100 million (around Rs.700 crore) in the 2013-14 fiscal year. In the course of the reorganization, up to 750 jobs may be cut across the company, it said.
The job cuts are a painful development, but the company will keep redundancies to a minimum, said Andreas Nauen, chief executive officer.
“The plans I am announcing will allow REpower to better meet today’s challenges and prepare for tomorrow’s opportunities, particularly in the offshore segment. Whilst the long-term outlook for the sector remains strong, the mid-term outlook is expected to remain uncertain and volatile, and we need to prepare for that,” Nauen said in a statement.
He added that the reorganization was a prerequisite for being able to react to market conditions more quickly and with greater flexibility.
On 24 January, REpower’s parent Suzlon Energy Ltd won approval for a Rs.9,500 crore corporate debt restructuring from its domestic lenders. The lenders, a consortium of 19 banks, agreed to enhance working capital facilities to the group by Rs.1,800 crore and a 10-year back-ended repayment plan as part of the exercise.
On 10 April, Mint reported that Suzlon Energy was aiming for a 20% cut each in operating expenditure, staff costs and headcount, besides selling non-critical assets.