Despite Buyout, Bell Canada Cuts 2,500 Managers
The $51 billion buyout of BCE Inc. (Bell Canada) (NYSE/Toronto: BCE) may have been saved earlier this month when a consortium of banks, pension funds, and private equity funds crafted a successful financing, but the deal can't save the jobs of 2,500 Bell Canada managers.
This week, BCE said the "departures" of 15% of management will represent a 30% total reduction in executive positions at Bell Canada that had been previously announced. The buyout -- billed as the biggest buyout ever -- was in jeopardy earlier this year after deteriorating financial markets caused banks to pull back on their earlier commitments to do the deal.
The company said the loss of positions will result in annual savings of about $300 million when combined with other reductions carried out earlier in the year.
"It is always difficult to see colleagues depart, but these changes are absolutely necessary," said George Cope, president of Bell Canada, in a statement. "We are moving forward with a streamlined management structure that brings everyone at Bell closer to the customer and allows us to compete more effectively."
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— W. David Gardner, InformationWeek