Greenville, S.C.-based electronic component maker Kemet Corp. is closing plants and cutting more than 800 jobs in the United States, Mexico and Europe.
The restructuring, aimed at cutting costs, boosting profits and consolidating recent Kemet acquisitions, will see 7 percent of the group's workforce axed.
That percentage includes a reduction of around 120 U.S. jobs and 250 in Mexico. Some processes will be switched to sites in China, the company said in a news release.
In addition, plants are set to close in Vergato, Italy, and Towcester, England, with about 420 layoffs expected, Kemet said. The plants are operated by Kemet's most recent acquisition, Arcotronics Italia SpA.
Work from the plants is due to be transferred to lower-cost plants in Batam, Indonesia; Matamoros, Mexico; Kyustendil, Bulgaria; and Suzhou, China, according to Kemet Chief Executive Officer Per-Olof Loof.
Kemet, which also has three plants in Mexico at Monterrey, Ciudad Victoria and Matamoros, made clear that this may not be the last of its restructuring and job cuts worldwide.
The cutbacks are set to begin in June. Kemet expects total annual savings from the moves of around US$34 million by the end of fiscal 2009.
Kemet produces plastic and metalized film and other types of electrical capacitors used in a range of electronic goods. The parts store, filter and regulate electrical energy and current flow.
``By implementing these immediate cost-saving initiatives, as well as ongoing integration efforts with our recently acquired companies, I am confident that we are taking the actions needed to secure both our company's short-term profitability and long-term future,'' Loof said.
Kemet has been in separate talks with employees and their unions in Italy and England over the proposed cuts.
Subsidiary Kemet Electronics Corp. runs a plant in Simpsonville, S.C., and also has an ``innovation center'' in Heidenheim, Germany, and another plant in Evora, Portugal.
The U.S. company runs two innovation centers in South Carolina, as well as two specialty electronics companies - Forest Electric Co. (Felco) in Chicago and Dectron AB in FÃ¤rjestaden, Sweden.
It was in October 2007 that Kemet bought Arcotronics of Sasso Marconi, Italy, a leading maker of polyester and polypropylene film and metalized film capacitors, for 17.5 million euros (US$15 million at the time).
Formed in 1962, Arcotronics also has plants in Sasso Marconi and Monghidoro, Italy; Landsberg am Lech, Germany; and Shanghai. In 2006, Arcotronics had annual sales of around US$207 million.
In April 2007, Kemet bought another Europe-based capacitor maker, Evox Rifa Group Oyj of Espoo, Finland. It specializes in film, paper and electrolytic capacitors and has plants in Suomussalmi, Finland; Weymouth, England; GrÃ¤nna, Sweden; and Nantong, China.
Kemet just reported that its third-quarter 2007 sales rose 38 percent to $228.5 million against the same period in 2006.