United Kingdom: Virgin Media O2 plans to cut thousands of jobs to reduce costs amid its £22 billion debt
London — British telecoms operator Virgin Media O2 plans to cut thousands of jobs in a sweeping shake-up, Sky News reported on Saturday, citing people close to the company, amid investor concern about its ability to service a £22 billion debt pile.
Up to 4,000 of the company's 16,000 employees could be affected, although the precise number has yet to be finalized, the report said. Most of the cuts are expected to affect non-customer-facing roles, while a number of senior leadership changes are already under way at the company, led by chief executive Lutz Schuler.
The company, jointly owned by Liberty Global and Spain's Telefónica, is also expected to review its use of contractors and suppliers to reduce costs. A company spokesman declined to comment on the plans, according to Sky News.
Cost-reduction details would be confirmed in financial rather than headcount terms alongside third-quarter results, due next Tuesday, according to sources cited by Sky News.
The Financial Times reported in July that Virgin Media O2's owners were weighing options to reduce the debt, including cutting its dividend and capital spending, and in September reported that shareholders were seeking to reduce costs by about £600 million.
If confirmed, the cuts would add to significant layoffs at BT Group and Vodafone Three as telecoms operators seek to become more efficient amid rising cost pressures, according to Sky News.
Photo: Sky News