GlobalNetFinancial Culls 50 Media Jobs
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[London, ENGLAND] GlobalNetFinancial.com, Inc., provider of financial information to many European Web sites, Monday completed an initial corporate restructuring that has reduced its global workforce by 50 jobs in media.
The move, which represents a 35 percent reduction in the workforce, has been a drastic measure to reduce annual costs by US $5 million.
Chief Executive Tom Hodgson said a reorganization of operations into three distinct business units would allow GlobalNetFinancial to entertain merger and acquisition opportunities in many different market sector. Specifically, he mentioned media, securities, independent financial advisor and Internet infrastructure sectors as being good opportunities for expansion.
"We are in discussions with various candidates for industry consolidation and strategic alliances in each of these areas, and we are determined to maximize these opportunities," said Hodgson.
Referring to the company as "the early-mover within the pan-European landscape," Hodgson added that GlobalNetFinancial has continually worked to reduce overhead costs and expenses.
"We retain a strong balance sheet, and we remain in an excellent position to implement our growth strategy," maintained Hodgson.
Although the message is couched in an upbeat way, the reality of a 35 percent workforce reduction is scarcely a cause for rejoicing. As Hodgson indicates, "industry consolidation" is now the top priority. In the near future, GlobalNetFinancial can be expected to form closer links with its partners, such as Freeserve, WorldOnline, BT, Scandinavia Online, and Telewest.
GlobalNet first announced cost efficiencies in January 2001, looking to save around US $12 million a year. It split its business into three subsidiaries: GlobalNet Capital Markets Corporation which runs its brokerage operations, GlobalNet Media Ltd. operating U.S. and European Web sites, and GlobalNet Financial Services running its B2B transactional application services.
For its next step, GlobalNetFinancial will begin to roll out its money and financial Web sites in a new format, beginning in April 2001. A single site at www.globalnetiNvest.com is scheduled to become the gateway to all the company's pan-European and North American sites.
Whether the jobs reduction has a negative impact on the quality of GlobalNetFinancial's media output remains to be seen. A minimized reduction in services may be a small price to pay for prudent financial management that ensures the company's long-term future.