So, what will happen next? How do you feel about it? Anyone has experiences with mergers (this is my first big one)? Predictions?
6 replies (most recent on top)
Sadly only management is getting severance, the rank and file employees are getting nothing. "Synergy" is Dutch for: " "We Hate Our Employees."
Many software people are being let go. NXP has said they are not going to any development on software that Freescale purchased (often using legal tricks) but doesn't know anything about. Freescale buys small software companies, but don't keep the key people who really know how the software works, and it slowly dies. Sad for all the second tier people left scrambling for jobs.
Layoffs are fact of life. Get used to it. For the US employees, it is actually better than European ones: in the US you can find a similar job in a similar company. In Europe, there are NO similar companies. There is that junk of a semicon ST which is afloat by French taxpayer money and of course Infineon but who wants to go work in Germany? Moreover, in US you get American paycheck. Here in Europe, you get half of what you would get for the same work in the US and you pay a whole lot more tax. Don't forget a gallon of gas costs you 8 dollars in Europe!
Sorry, correction, "It's already been announced that the new company will be called NXP".
First, understand that the Truth about this acquisition is in the above comment "it is not a merger of equals as the management present it to the employees but rather a bigger one (NXP) buys a weaker one )Freescale)". With NXP in the dominant position, the bulk of the layoffs are coming from Freescale. It's already been announced that the new company will be called Freescale.
It's already a bloodbath for Freescale. Ask around and you'll find that already about 2000+ Freescale employees have been very quietly let go over the past few months. But there worst is yet to come and it's a sure thing that NXP is going to gut Freescale's management, especially the many former NXP managers that jumped to Freescale. This is not about What's Best, it's about egos and a European company gutting an American company simply because it can. This is going to result in a deepening of the constantly expanding unemployed semiconductor professionals in the United States.
The NXP playbook is taken right out of how Mercedes-Benz acquired and then gutted Chrysler. After MB bought Chrysler, thousands were laid off in Detroit leaving an abundance of unemployed automotive engineers. It ended with MB planning to completely dismantle Chrysler so that the company would cease to exist, saved only by Chrysler's purchase by Cerberus Capital Management at one minute before doomsday.
Soon Freescale will be no more, a victim of it's own horrid mismanagement, resulting in it's inability to be more innovative than it's competitors.
Whenever you hear "synergies" as the main reason for a merger, you must expect layoffs. FSL has 850 mil pa expenses in R&D and 500 mil in SG&A. NXP has around 760 mil generating more revenues than FSL.
I doubt the SG&A will be significantly reduced because the number of customers of the new entity will be larger and the support engineers will need more bandwidth. When the product lines will be sorted out, the R&D expenses will be the main resource for what was announced as "clear path to 500 mil pa savings".
Let's for a moment assume half of that saving will be assumed by FSL (although it is not a merger of equals as the management present it to the employees but rather a bigger one buys a weaker one). I would rather say that it will be 2/3 FSL and 1/3 NXP. If FSL will loose 250 mil of its spendings, some of it may come R&D, some from factories.
If 150 mil will be reduced from FSL R&D, this means that the team will be reduced by 20% at the minimum. You can do the math if the more savings are going to be supported by FSL.