Hewlett Packard To Cut 24,600 Jobs In EDS Intergration

September 15, 2008 6:04 p.m. EST

San Francisco, CA (AHN) - Hewlett Packard announced Monday they will cut 24,600 jobs, roughly 8 percent of their workforce over the next three years as part of the integration of recently acquired Electronic Data Systems Corp.

In August, HP completed its acquisition of EDS for $13.9 billion. The majority of the cuts will be EDS employees and half of those will be domestic jobs, according to HP.

HP expects annuals cost savings from the cuts to be roughly $1.8 billion a year. The company plans to take goodwill and restructuring charges totaling $1.7 billion in the fourth quarter to account for the move.

The acquisition of EDS gives HP a significant position in the IT services sector allowing them to better compete with industry leader IBM.

"HP has a strong track record of making acquisitions and integrating them to capture leading market positions. We will deliver on the promise of HP and EDS for our customers and shareholders." said Mark Hurd, chairman and CEO, according to the East Bay Financial Times. Shares of Hewlett Packard fell 3.5 percent on Monday to $45.33.