Brazil's Tele Norte Leste To Cut 25% Of Workforce By End '98
Dow Jones Newswires
NEW YORK -- Brazilian fixed wireline holding Tele Norte Leste Participacoes SA (TNE) plans to cut its
workforce by 25% by year-end, a company spokesman said Tuesday.
The Tele Norte Leste holding was privatized on July 29, and is controlled by a consortium led by construction
firm Andrade Gutierrez. The company has 32,000 employees on payroll, and 18,000 subcontractors.
"The number of staffers cut will be around 8,000," said investor relations representative Jose Carlos dos Santos,
who added that the cuts will reach subcontractors in equal measure.
Tele Norte Leste is scheduled to list American depositary receipts on the New York Stock Exchange on
Monday, Nov. 16.
Dos Santos added that the cuts will be done throughout the 16 companies in the holding, in order to eliminate
duplication. As an example, he said that every one of the 16 companies has its own investor relations and data
processing departments.
The official added that Tele Norte Leste will offer an early retirement incentive program but couldn't estimate the
cost for Tele Norte Leste. "Telerj offered employees 40,000 reals (BRR) (1$=BRR1.18) in 1996, but the figure
will certainly be lower," he said in reference to the Rio de Janeiro state company.
Dos Santos couldn't confirm reports that Tele Norte Leste would invest BRR2 billion in 1999.
-By Margarita Palatnik; 201-938-2226; margarita.palatnik@cor.dowjones.com
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