Up to 170 jobs at Cable & Wireless Ireland are at risk following the firm's decision yesterday to shed 3,500 jobs and pull out of continental Europe and the US.
The British firm refused to comment on whether the decision would affect its Irish division which supplies hundreds of firms with telecoms services. But industry sources believe the scale of the corporate restructuring will lead to redundancies in Dublin.
Cable & Wireless supplies a range of firms in the Republic, such as IBM, Coillte and the ICS building society, with a range of network and systems integration services.
A decision by the firm to exit the domestic market would further undermine competition in the market which has seen several big players exit this year already.
More than 1,000 jobs have been lost in the local telecoms sector in the past year as firms continue to reduce staff following years of over-investment during the internet-fuelled boom.
The mobile phone group 02 confirmed a report on electricnews.net yesterday that it would make 40 staff redundant at its commercial department this month.
Meanwhile, the restructuring announcement by Cable & Wireless said it would also take an £800 million sterling (€1.3 billion)restructuring charge to cut costs at its global operations.
The US and European retreat will bring £400 million per year in savings and £200 million more in capital expenditure cuts. As a result, Cable & Wireless Global hopes to stop losing money by March 2004.
The new strategy means the British group's US and continental European operations would only serve multinational companies.
This is a climbdown for Global's architect, Cable & Wireless chief executive Mr Graham Wallace, after a year of US expansion at the division, which provides corporate web-hosting and telecoms.
Global makes up more than two-thirds of Cable and Wireless's business and the new plan leaves intact its UK and Japanese businesses that earn three-quarters of the division's revenue.
Cable & Wireless shares had hit 153p this month on hopes it would abandon the US and continental Europe entirely.
Disappointment over that and the heavy costs led to a heavy share sell-off.
Cable & Wireless was the biggest faller on the London Stock Exchange, sliding a hefty 36 per cent to close at 101p sterling.
