Lexmark exits inkjet biz, to close Cebu plant by 2015

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In a massive restructuring move announced in a statement on Aug. 28, the company said it will stop making inkjet printers to save cost and would need to completely shut its facility in Cebu three years from now. Paul Rooke, Lexmark chairman and chief executive officer, said the announcement represents a ?difficult decision? for the company, but is necessary to drive improved profitability and significant savings. “Our investments are focused on higher value imaging and software solutions, and we believe the synergies between imaging and the emerging software elements of our business will continue to drive growth across the organization,? Rooke said. The restructuring actions are expected to result in reductions primarily in inkjet-related infrastructure, as well as positions in research and development, supply chain, and other support functions. The actions also include eliminating inkjet development worldwide, including costs related to facilities, tooling, equipment, contract termination, and scrapping in process inventory, which are expected to be principally complete by the end of 2013. The restructuring actions are expected to result in the elimination of approximately 1,700 positions worldwide, including 1,100 manufacturing positions in Cebu. The company said it is also working with its strategic advisors to explore the sale of the company’s inkjet-related technology. These actions, the company added, are expected to generate $85 million savings in 2013, increasing to ongoing annualized savings of $95 million beginning in 2015. ]]>

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