Unisys slashes 1,300 jobs

SAN FRANCISCO Mon Dec 22, 2008 7:22pm EST

SAN FRANCISCO (Reuters) - IT services company Unisys Corp (UIS.N) said Monday it will slash 1,300 jobs, or more than 4 percent of its work force, and suspend matching contributions to its U.S. 401(k) plan as it moves to cut $225 million in costs.

In addition, Unisys said it will forgo salary increases in most of its markets next year.

A company spokesperson said the job cuts would be worldwide but did not give further detail. The headcount reductions have already begun and will continue into 2009. Unisys also plans to consolidate facilities.

The U.S. 401(k) plan was costing it $50 million a year, the company said.

Unisys expects to take a fourth-quarter restructuring charge of $80 million to $85 million.

It has been a brutal year for Blue Bell, Pennsylvia-based Unisys, whose shares have fallen around 88 percent. Last month, Standard & Poor's removed the company from the S&P 500 index.

In October, Unisys named J. Edward Coleman as chief executive, calling him a "recognized leader in driving corporate transformations and turnarounds."

The company's stock now trades at under $1, and earlier this month it announced plans for a reverse stock split.

Shares of Unisys closed at 53 cents, down a penny.

(Reporting by Gabriel Madway; Editing by Christian Wiessner)

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