* Cuts 7 pct of staff globally
* Aims to save 50 mln euros annually
* shares rise 6 pct to 13-month high
By Eero Vassinen and Tarmo Virki
HELSINKI, March 20 Finnish IT services group
Tieto plans to cut 1,300 jobs, or 7 percent of its
staff, as it struggles to compete against global rivals like IBM
The company's share rose 6 percent to the highest level in
13 months on the move, which Tieto said will cut annual costs by
50 million euros ($66 million).
The cuts will include 500 jobs in Finland, 300 in Sweden,
and around 500 elsewhere, the company said.
"Measures this harsh speak for themselves. The competition
is tough especially in the Nordic, where competitors have grown
through mergers," Pohjola Bank analyst Hannu Rauhala said.
Tieto's Swedish rival WM-Data was bought by Logica
in 2008 and in Norway EDB acquired Ergo Group in
2010. It also faces fierce competition from International
Business Machines and Wipro and other Indian rivals.
Tieto said the move was aimed to lift its operating profit
margin to 10 percent from 5.4 percent in 2011. It also said it
wants to boost earnings per share by more than 15 percent a year
on average through 2012 to 2016.
It will book restructuring charges of around 50 million
euros from the job cuts.
Tieto, which has focused on its Nordic home markets, said
its product engineering services business would increasingly
seek to grow elsewhere.