More Layoffs at PMC-Sierra

-August 31, 2006

PMC-Sierra Inc. will close its Ottawa, Canada, development site and axe between 30 and 40 workers, primarily from R&D, according to a recent filing with the the Securities and Exchange Commission.

The trimming will come at a restructuring cost in the range of approximately $5.8 million to $7.2 million, which includes a range of $2.3 million to $3.2 million in one-time termination benefits and relocation costs, and $3.5 million to $4 million for consolidation of facilities and adjustments of previously recorded provisions.

This isn't the first time in recent months PMC-Sierra has handed out pink slips. In July, the company eliminated approximately 10 positions at its Portland, Ore., development site, resulting in restructuring and other charges of approximately $1.7 million.

The company expects operating expense savings from the two most recent layoffs of approximately $1.5 million to $1.7 million in Q4 and a normalized quarterly expense savings of approximately $1.8 million to $2.2 million in subsequent quarters.

The string of layoffs reaches as far back as last summer, when the company enacted plans to slash 89 jobs in Q2 2005.

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