It's been a big weekend for Genzyme, and the news isn't about Sanofi-Aventis for a change. The company is shedding some weight; it's planning some 1,000 layoffs over the next 15 months, the Boston Globe reports, and has struck a deal to sell off its genetics division to Laboratory Corp. of America.
Apparently, the company reviewed its workforce over the summer and determined to cut 10 percent, or about 1,000 workers, from its payroll of 12,800 employees. Those are the figures the Globe is reporting, citing a company memo from CEO Henri Termeer (photo). The company won't confirm the numbers, but does say that it's planning to trim workers.
"We feel the right thing to do is to take a couple of days to speak to employees before making a public announcement," spokesman Bo Piela tells Reuters. At least some notifications happened Friday. Piela tells Bloomberg that specifics on the cost-cutting will come later this week.
Meanwhile, in another streamlining move, the company agreed to divest its Genzyme Genetics unit to LabCorp for $925 million in cash. LabCorp has agreed to offer jobs to the unit's 1,900 workers after the deal closes, including top management, Genzyme says in a statement.
The announcement had a between-the-lines message for Sanofi--which has been trying to buy the company--and shareholders who might sell their stock. The LabCorp deal shows that Genzyme's management team "is uniquely position to unlock the underappreciated value of Genzyme's diverse businesses," Termeer says. In other words, Genzyme has a good thing going already--and it's worth more than people think.
ALSO: Sanofi-Aventis arranged about $10 billion of underwritten loans to back its bid Genzyme, two people familiar with the situation tell Bloomberg. Report