Digital says time needed for jobs plan

Digital's 18,000 employees in Europe will probably have to wait until the end of the year to find out if their jobs are safe. Compaq Computer Corp General Manager, Mr Andreas Barth, said in an interview that it would take time to put together a plan for integration with Digital. The two companies announced plans to merge earlier this week.

A European executive at Digital's German unit said yesterday that no job cuts were being considered yet as a result of the planned takeover of Digital by Compaq, the world's biggest personal computer maker.

Mr Barth, in London for Compaq's annual presentation to journalists says "Then we will really have to develop the plan and that might take until the end of 1998," he added.

What will be the impact on Digital's European employees?

"Frankly we don't know yet. The only thing that we know so far is that Digital's operation in Europe is very important. It does $5.8 billion (£4.2 billion) in annual sales. They have 18,000 people, they have five factories, they have important service and support centres," Mr Barth said.

"Of the 18,000 people, 8,000 are in service and support. All this is very important. And they (Digital worldwide) did 44.5 per cent of their revenue in Europe." The company employs 1,100 people in Ireland.

At a news conference earlier, COMPAQ President and Chief Operating Officer Mr Eckhard Pfeiffer said Digital would be expected to reach the Houston-based personal computer maker's level of efficiency.

Last year Compaq earned net income of $1.9 billion on sales of $24.6 billion. Its workforce totalled 18,900. Digital, which makes computers, high technology hardware and provides corporate computer services, earned $141 million on sales of $13 billion, with a workforce of 54,400.

"Over the last five years or so Digital has done tremendous work restructuring the company. I think they are in reasonable shape, otherwise we would not have bought them," Mr Barth said.

Mr Barth said Digital Europe's major asset was the service and support organisation.

"I think it is a perfect match and creates a new force in the industry here that is only second to IBM."