About 650 Longmont workers at computer disk-drive maker Maxtor Corp. will lose their jobs following rival Seagate Technology’s purchase of the company.
The remaining 200 or so Longmont workers – some engineers, product-development and customer-service workers and some managers – will be offered jobs at Seagate in Longmont, said Cindy Martini, a Seagate spokeswoman.
Seagate is eliminating about 6,400 Maxtor jobs worldwide following its $1.9 billion purchase of Maxtor. The deal, announced in January, closed Monday.
An unspecified number of Maxtor workers will be offered “retention bonuses” to stay on in Longmont for the next six months as Seagate phases out the Maxtor disk-drive product line, Martini said.
Those losing their jobs – representing 75 percent of Maxtor’s Longmont workforce – are being given severance packages.
“Maxtor employees are our neighbors and colleagues. We’re sensitive to the fact this is going to be a challenging time for them,” Martini said.
Seagate has about 1,300 workers in Longmont. It is expected to keep some of the 450,000 square feet of building space that Maxtor leases for its operations, said John Cody, president of the Longmont Area Economic Council.
While the Maxtor job losses are substantial, Longmont has been adding other jobs at a rapid clip in the last year, Cody said. He said he expects many of the Maxtor workers to get jobs at other Longmont-area companies.
“Time will tell,” Cody said. “We hope most, if not all, of the jobs lost at Maxtor will be offset by other job growth.”
Worldwide, about half of Maxtor’s 12,800 positions will be cut, Woody Monroy, a spokesman for Grand Cayman-based Seagate, said Monday. No Seagate jobs will be eliminated, Monroy said.
Seagate agreed to buy Maxtor in December to help lower product costs and increase its share of the $27.4 billion hard-drive market. The deal allows Seagate, which is benefiting from rising demand for laptops and digital video recorders that use disk drives, to eliminate its largest rival while keeping its own staff intact.
Monroy said total restructuring costs will be $500 million, repeating the company’s estimate from December. Monroy declined to be specific about costs directly related to the job cuts, which the company expects to complete by early 2007.
Bloomberg News contributed to this report.
Staff writer Beth Potter can be reached at 303-820-1503 or bpotter@denverpost.com.
