10.08 Europe/London, July 19, 2011 By Julian Clover
Cisco is disposing of its set-top manufacturing operations in Juarez, Mexico, transferring the facility to the Foxconn Technology Group.
The anticipated move is part of Cisco’s Action Plan that will see a 15% reduction in the company’s executive tier and a 9% reduction in its overall workforce. Cisco said that while it did not take the decisions easily, it believes the company has retained the capabilities and talent to support its lone term strategy.
“Today’s announcement further simplifies and consolidates Cisco’s manufacturing operations,” said Gary Moore, executive vice president and chief operating officer, Cisco. “After working closely with Foxconn for many years, we know they are a strong strategic fit with Cisco’s long-term. We remain fully committed to our service provider customers and partners, and will continue investing in existing and new video platforms, including set-top-boxes, as part of our Videoscape vision.”
Cisco took on ownership of the 5,000-person Juarez facility with the acquisition of Scientific Atlanta in 2006. The facility manufactures video and telecommunications equipment for the service provider market.
The transaction is subject to regulatory approvals and is projected to close by October 2011.