Parthus Technologies will shed up to 65 staff following the merger with the US-Israeli firm, Ceva, as it ditches two business units to improve its finances.

Job cuts and facility closures will result in a once-off restructuring charge of $3 million (€3.1 million) in the third quarter. The Dublin-based firm, which employs 350 people worldwide, will detail the number of redundancies when it publishes results next month.

The announcement of redundancies at the firm follows successive public comments by its management that a proposed merger would not result in job losses here.

But yesterday Parthus said that if the proposed combination with Ceva was consummated, it would discontinue investments in its radio frequency and hardware-based security business.

This would enable Parthus to focus on areas where it has market leadership: digital signal processing, mixed signal and wireline communications and wireless communications, the firm said.

The radio frequency division employs 45 people in Dublin, Belfast and France while the security group, which is based in the US, employs 20 staff. Some employees may be offered redeployment at the firm or retraining.

A Parthus spokesman said the decision to close the business lines was taken "independently of the merger" and the firm had been examining this already.

He said the firm had decided to close a design facility in the north of France and one other facility in the US may be relocated.

The company's offices in Belfast, San Jose and Dublin would not close, he said. Parthus currently employs about 200 staff in Dublin.

In a second announcement yesterday, Parthus confirmed the High Court had directed it to hold an extraordinary general meeting on September 26th in connection with its proposed merger with Ceva, a unit of the US-Israeli firm DSP Group.

Subject to the approval of the scheme at those meetings it is anticipated the merger will be completed before the end of October 2002.

Parthus said the merger terms had been amended to eliminate the payment of an aggregate of $100,000 to Parthus shareholders. However, the proposed payment of $60 million to Parthus shareholders remained, it said.

Parthus announced its proposed merger with Ceva on April 5th 2002 as a "merger of equals".

The combination of the two firms is intended to create a one-stop design shop for chip firms in the mobile phone sector.

Parthus shares closed down 1 per cent at 19.61 pence in London yesterday.