ST-Ericsson would transfer application processor business to ST and cut off 1,700 staffers

Published:2012/4/24 2:46:00 Author:Ecco From:SeekIC

ST-Ericsson NV has announced a new strategic direction. They would plan to cut up to 1,700 staffers to reduce its breakeven point. ST-Ericsson NV is a loss-making mobile chip joint venture between STMicroelectronics and Ericsson. However, the company would change its main standalone application processor field to smartphone and tablet computer platforms. The standalone application processor activities will be transferred to STMicroelectronics.

ST-Ericsson or by partners would develop the electronics building blocks for mobile devices, then ST-Ericsson assembles them to improve time-to-market. The list of electronics building blocks mainly includes application processors, modems and wireless connectivity as well as power management, RF, analog and mixed-signal functionality. At the same time, ST-Ericsson said it would continue to develop modem intellectual property, sell thin modems and possibly license modem IP to third parties.

After ST-Ericsson transfers its application processor business and employees to ST, it will create app processor-plus-modem platforms under a licensing agreement with ST. ST-Ericsson said it would plan to cut off 1,700 employees including the employees who would be transferred to ST. Total restructuring costs are estimated to be approximately $130 million to $150 million. Those cuts plans would result in annual cost savings of $320 million.

Reprinted Url Of This Article: http://www.seekic.com/blog/IndustryNews/2012/04/24/ST_Ericsson_would_transfer_application_processor_business_to_ST_and_cut_off_1700_staffers.html

Print this Page | Comments | Reading(597)