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Ericsson Raynet to Restructure.

MENLO PARK, Calif.--(BUSINESS WIRE)--June 20, 1995--Ericsson and Raychem Corporation today announced a reorganization of their Ericsson Raynet joint venture in order to sharpen focus on selected high potential products, markets, and customers and to reduce costs. Changes include the relocation of manufacturing operations to existing Ericsson units in Sweden and consolidation of certain general and administrative functions within Ericsson in the U.S. and Sweden. The restructuring will begin immediately and continue during calendar 1995.

"The steps announced today reduce our operating costs and break-even point significantly in part because we will now take advantage of lower cost Ericsson manufacturing capacity and integrate our administrative functions within those already in place in the U.S. and Sweden," said Stig Johansson, Ericsson Raynet president and CEO. "Our R&D efforts will continue the development and refinement of our existing fiber access products for markets around the world. Taken together, these moves further our earlier desire to move toward the optimum integration of the joint venture into Ericsson and will strengthen our access product lines worldwide."

These changes will eliminate approximately 300 positions from Ericsson Raynet's 730-person organization. Nearly all of the reductions will take place in Menlo Park, California. Ericsson expects that some employees will be offered positions in other of its expanding California operations. Severance benefits and outplacement assistance will be provided to the Ericsson Raynet employees whose positions are being eliminated.

Raychem Corporation of Menlo Park, California, is an international company with more than 9,000 employees in more than 40 countries and sales of $1.5 billion in fiscal 1994. The company utilizes its expertise in materials science, product design and process engineering to develop, manufacture and market high-performance products for electronics, industrial and telecommunications applications.

Ericsson's 75,000 employees are active in more than 100 countries. Their combined expertise in switching, radio and networking makes Ericsson a world leader in telecommunications.

CONTACT: Ericsson

Kathy Egan, Vice President Communications

212/685-4030

or

Raychem Corporation

Scott F. Wylie, Director of Corporate Communications

415/361-7855
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Publication:Business Wire
Date:Jun 20, 1995
Words:337
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