Restructuring Nera Networks operations

The administration in Nera Networks AS, a wholly owned subsidiary of Nera ASA, have planned to carry out a restructuring of operations consequently leading to a downsizing in the number of employees from 180 to 80.

The administration in Nera Networks AS, a wholly owned subsidiary of Nera ASA, have planned to carry out a restructuring of operations consequently leading to a downsizing in the number of employees from 180 to 80. The reduction will be carried out sequentially and is related to the production of radio link equipment in Bergen. The shift in operations will in time lead to a closing of the internal production of large antennas, RF modules and the main parts of mechanical production. The proposal is subject to approval by the governing bodies in Nera Networks and Nera ASA prior to execution.

There are two conditions that form the basis for the administration's proposed changes in operations; optimization of today's production and preparations for a new product generation.
 
The calculations made by the administration show that a change in operations related to existing products will give annual savings of approx. NOK 30 million based on estimated 2004 business volume. Simultaneously the risk for losses related to fluctuations in business volume will be considerably reduced.
 
Additionally, the company is now developing a new product generation. The new radio links are constructed in a way so that it is no longer advantageous with internal production. To prepare the transition and prevent problems related to this, it is desirable to carry out a sequential change to external subcontractors, securing the necessary profitability.
 
- This is a continuance of the structural work enabling Nera to retain its competitiveness also in the future, and it is our opinion that the proposed operating model will lead to the best results, says Øivind Isaksen, president of Nera Networks. He regrets the negative impact this transition will have on the affected employees, but emphasizes that if Nera succeeds with the transition to a new generation of radio link products, it should form the basis for a number of interesting employment opportunities in the future.