(AOL) AOL Incorporated to Lay off 1,200 Workers

January 12th, 2010

As part of its restructuring program, AOL Inc. (AOL), the struggling Internet company, had earlier announced plans to trim a third of its staff or approximately 2,300 employees through a voluntary retirement program. However, only 1,100 employees have accepted the package so far.

Consequently, AOL needs to shed 1,200 more to reach its staff lay-off target. The company hinted at plans to shutter down many offices in Europe, starting with Spain and Sweden. After these buyouts and lay-offs, AOL would have about 4,700 employees.

These attempts will reduce annual costs by $300 million. However, the company also notified that it would also incur severance and restructuring-related charges of $200 million.

The marriage between Time Warner Inc. (TWX), a global leader in media and entertainment businesses, and AOL, which took place in 2000, ended on December 9, 2009, when the former announced the completion of the spin-off of AOL.

AOL had been striving to revamp itself to become an independent online company, preparing to compete with Google Inc. (GOOG), Yahoo! Inc. (YHOO) and Microsoft Corporation (MSFT) in the U.S. market for online advertising valued at $29 billion. The company will now focus more on capturing online readership by increasing content offerings and providing an online advertising platform.

AOL shares close at $25.97 on Monday, up 1.1% from the previous day.

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(AOL) AOL Incorporated to Lay off 1,200 Workers

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