M2 to wield jobs axe after buying binge

M2 Telecommunications to cut more than 10 per cent of its local workforce after string of high-profile acquisitions.

M2 Telecommunications is preparing to cut more than 10 per cent of its Australian workforce after identifying more than 100 duplicated roles it has picked up through a string of high-profile acquisitions.

Some 150 roles across administration, customer service, technology, provisioning and sales have been targeted for redundancy at the acquisitive telecommunications company, which is looking to remove $6 million in unnecessary costs this year.

The flagged job cuts will all come from its Australian workforce, which numbers about 1000 employees.

With contact centres in The Philippines and operations in New Zealand, M2 has about 3000 employees.

M2 has been on an acquisition binge during the past five years, spending more than $500 million acquiring Dodo, Eftel, Unitel, People Telecom and Primus Telecommunications.

Its acquisitions have helped bolster the company’s subscriber numbers, but it has also left the company with duplicate roles that now need to be cut.

The cuts will form part of the company’s “acquisition integration program” which was triggered to remove duplication in M2’s operations following years of acquisitions.

“This decision was not made lightly and we take any impact on our team very seriously,” M2 chief executive Geoff Horth said.

“We very carefully consider any changes that may affect our team and we enter into the consultation process with the aim of minimising any potential impact on the team and maximising redeployment opportunities.”

It’s the second time in six months that M2 has announced a major round of redundancies. In October the company said it would cut 100 roles from its business after completing acquisitions of Primus, Dodo and Eftel.

Mr Horth told The Australian that M2 is targeting about $6 million in cost savings from the business this year.

“Post acquisitions we have a number of duplicated functions and we have high-cost work that can be done in low-cost environments,” he said.

“We spent about $4m in the first half in cost-out programs and we will do about half of that in the second half. But that $6m target will go from a cost this year to a benefit next year.”

The cuts come as M2 continues its hunt for acquisition targets.

The telco recently said it was considering a “couple of sizeable acquisition opportunities”, potentially worth more than $100m to propel the company into its next phase of growth.

Mr Horth said M2 would not be spending money on any targets that brought in less than $25m in earnings a year, saying anything below that figure would be ‘immaterial” to the company’s growth.

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