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Applied Materials to lay off 6 to 9 pc of its workforce

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Supriya Rai
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SANTA CLARA, USA: In order to focus more on growth, Applied Materials, a semiconductor equipment maker, has planned to cut down its global workforce through its voluntary retirement program and other workforce reduction actions.

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Through this scheme, the company plans to reduce 6 to 9 percent of its global workforce and it is likely to affect approximately 900 to 1300 positions.

"Achieving our strategic objectives requires us to deploy our talent in the best way possible," said Mike Splinter, chairman and CEO. "We are taking action to realign our worldwide organization and workforce while investing in key product development capabilities that will enhance our ability to grow."

The voluntary retirement program will be available to certain U.S. employees who meet minimum age and length of service requirements, as well as other business-specific criteria. In addition, Applied plans to implement other workforce reduction actions globally, the extent of which will depend on the number of employees who participate in the voluntary retirement program and other considerations.

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The company expects to complete the restructuring plan by the end of the third quarter of fiscal 2013, depending on local legal requirements. The plan is projected to make available approximately $140 million to $190 million annually to fund key growth initiatives.

Applied expects to incur aggregate pre-tax restructuring charges comprised of severance and other termination benefits in the range of $180 million to $230 million, substantially all of which will be paid in cash.

Due to the nature of the plan, the projected cost amounts are subject to multiple assumptions and estimates, including: the number and job levels of employees who participate in the voluntary retirement program; the nature and extent of additional workforce actions required to complete the plan; and other factors.

The company will begin recording these restructuring charges in the fourth quarter of fiscal 2012 and expects that the remainder will be recorded during fiscal 2013.

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