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Last Updated: Friday, 6 May 2005, 12:24 GMT 13:24 UK
800 Marconi staff cut in shake-up
Marconi worker at Coventry factory
Marconi generates a quarter of its UK work from BT
Telecoms equipment group Marconi is to cut 800 of its UK workforce as part of a shake-up after the firm failed to win part of a key 10bn deal with BT.

The company said 450 jobs would go in Coventry, more than a quarter of its 1,600 workforce at the site.

Its Edge Lane plant in Liverpool will be closed, with the immediate loss of 300 jobs. About 300 positions will be moved to other sites in the North West.

Marconi also said it would switch the focus of its business away from the UK.

It added that while it would try to move workers to other sites, "all staff in Liverpool are ultimately at risk of redundancy".

Those that are transferred are expected to be moved to the Huyton and Chorley sites.

The firm currently employs 4,500 people in the UK at sites including Coventry, Liverpool, Basildon, and Beeston near Nottingham. The remaining 50 job losses will be spread across the UK.

Focus on Europe

The decision to concentrate on its sites elsewhere in Europe and North America reflects the expertise at those sites, the company said.

Marconi share price graph

As part of the revamp, the company said it would be creating four "centres of excellence" in Europe and North America, focusing on its "main areas of expertise", spokesman Stephen Hobson said.

In a statement, the company said the new business groups would be Softswitch in Northern Europe, Wireless in Central Europe, Optical and Access Networks in Southern Europe and Data Networks in North America.

Chief executive Mike Parton added that the "new leaner organisation" would enable Marconi to cut costs and improve its competitiveness.

Marconi generates about 25% of its work in the UK from BT, and last week warned that losing out on the BT deal was likely to have "a jobs impact".

The group will continue to supply equipment and services to BT under existing contracts, including a 90m-a-year deal that runs until 2008.

End of an era

"This is a big blow for the company, its workforce and highly skilled jobs which the UK cannot afford to lose," Peter Skyte, national officer of the union Amicus, said.

1996 - Lord Simpson becomes chief executive of group, then named GEC. He begins to dismantle 2bn cash pile built up by predecessor Lord Weinstock
1999 - GEC's defence operations sold off for 7.7bn as the firm changes focus to telecoms and rebrands itself as Marconi
2001 - Lord Simpson admits the firm has lost hundreds of millions of pounds in just three months. Thousands of jobs are axed and Lord Simpson later resigns
May 2002 - Marconi posts record 5.7bn loss
August 2002 - 4bn restructuring deal agreed which involves thousands of job losses
2003 - 'New' Marconi Corporation shares debut on FTSE
2004 - Wipes out 669.5m debt mountain four years ahead of deadline
January 2005-Signs deal with China's Huawei Technologies, giving it access to lucrative Asian markets
April 2005 - Loses out on part of 10bn BT contract
May 2005 - Axes 800 UK jobs

"Given that the company would not tell us anything two days ago about their plans for job cuts, this is a cynical ploy to put out bad news on the day of the General Election results."

However, Marconi denied that the timing of the announcement was a bid to bury bad news.

"We did not want our employees going through another weekend of uncertainty," spokesman David Beck told the Press Association.

The closure of the company's Liverpool plant - which specialises in research and development - ends more than 100 years of history.

Known as British Insulated and Helsby Cables, Marconi began manufacturing manual telephone exchanges at the plant in 1903.

The job losses in Coventry are a further blow to the West Midland's economy in the wake of the closure of MG Rover's Longbridge plant and 850 redundancies at Peugeot's Ryton factory.

Job losses now likely at Marconi
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