MONTREAL — The Montreal-based Microcell Telecommunications Inc. today announced that it will lay off 149 employees across Canada. This represents approximately 6% of the Company’s total current workforce. Microcell provides cellphone service under the Fido brand name.
This measure is the result of difficult financial market conditions. Microcell also announced that it has renegotiated the terms of a major contract with a vendor in order, among other things, to avoid being in default under this contract.
“Our objective is to ensure that we have a realistic and viable business plan for the coming years,” said André Tremblay, President and Chief Executive Officer of Microcell Telecommunications Inc. “Although it is always a difficult decision to lay off employees, we believe that the reduction of our operating costs is a necessary step to enable us to remain an effective competitor on the market and to ensure our future growth.”
Mr. Tremblay also stated that the measures announced today do not target Microcell’s front line sales and customer service teams. “We maintain our full ability to continue acquiring subscribers and to provide our customers with high quality network and service,” he said. Most of the layoffs announced today are effective immediately, with a small number to take place by the second quarter of 2003.
According to company spokesperson, laid-off employees will receive severance packages. Furthermore, the Company entered into a forbearance and amending agreement with its secured bank lenders in which they agreed to forbear until December 23, 2002, subject to certain conditions, the exercise of any rights with respect to certain possible defaults.
One of the possible defaults to which the forbearance agreement applies relates to non-payment to a vendor under a material contract. Microcell announced today that it has renegotiated the terms of this contract in order, among other things, to avoid being in default under such contract.
Principal shareholders: Telesystem Ltd., T-Mobile USA, Inc. (formerly VoiceStream Wireless Corporation) Capital Communications CDPQ Inc. Employees: Over 1,500 employees across Canada.
