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Concord EFS To Consolidate

L ayoffs are on the horizon at Concord EFS Inc. However, the elimination of jobs is because of recent acquisitions rather than market downturns or failed dot-com ventures. Concord EFS recently instituted a company-wide consolidation plan to expedite the integration of recent network acquisitions, including the February acquisition of Star Systems Inc., a debit network.

The consolidation plan has three parts:

+ Consolidation of data centers and other facilities to eliminate redundancies.

+ Reassignment or termination of certain employees timed to coincide with the integration of redundant processing platforms.

+ Functional integration of the STAR organization into Concord.

Approximately 250 employees, or about 10 percent of Concord's work force, are expected to be laid off or lost through attrition. The company also expects to incur a one-time charge, net of taxes, between $75 million and $90 million in the first quarter of 2001 in conjunction with the consolidation plan.

"These consolidation activities represent the second phase in our multiyear plan to build our network and payment businesses," says Dan Palmer, Concord chairman and CEO. "The first phase was to focus on growing the business by strengthening customer relationships, cross-selling services, and introducing new products, and we succeeded at producing annual revenue growth in excess of 30 percent over the past two years."

Palmer continued, "While our recent acquisitions have added new technology and management talent, they've also created areas of operating redundancies. Phase two of our multiyear plan is to take steps over the next 12 months to capture synergies within our network operations and align our resources across the enterprise for greater efficiency and improved service delivery."

Concord is an electronic transaction processor, providing transaction authorization, data capture, settlement and funds transfer services to financial institutions, supermarkets, petroleum retailers, convenience stores and other independent retailers. Concord's primary activities include payment services. For more information, visit its Web site at www.concordefs.com.