UPDATED: Acxiom Lays Off 266; 138 Lose Jobs in Arkansas

by Lance Turner and Gwen Moritz  on Wednesday, Sep. 12, 2007 11:06 am  

Acxiom Corp. of Little Rock is cutting about 266 positions companywide, including 138 in Arkansas, the data services firm announced Wednesday.

The layoffs represent about 3.7 percent of the company's global workforce.

"Slower revenue growth drove us to take this action to reduce expenses," Charles D. Morgan, Acxiom's CEO, said in a news release. "The workforce reduction, in addition to other targeted expense cuts, will position Acxiom to deliver improved financial results."

Morgan said jobs were eliminated across all areas of Acxiom's U.S. business.

Acxiom spokeswoman Suellen Vann said the company, which is being purchased by private equity firms ValueAct Capital Partners and Silver Lake Partners, would not comment on more specific reasons for the layoffs beyond its written statement. Questions ArkansasBusiness.com would have asked include:

  • What specific positions are being cut?
  • What other expenses are being cut?
  • Is Acxiom reducing its IT services business? (ValueAct Managing Partner Jeffrey Ubben was not a fan.)
  • Is Acxiom losing any high-level managers? On Tuesday, when ArkansasBusiness.com called to inquire about rumors of coming layoffs and management departures, Vann said one "leader" level manager in Colorado had announced his retirement
  • What kind of savings does Acxiom expect from the workforce reduction?
  • Are the layoffs tied to the company going private?
  • Are the layoffs tied to the loss of any Acxiom clients?
(Update: Vann later answered some of these questions for ArkansasBusiness.com here.)

The New Norm

The move comes as Acxiom is in the final stretches of going private. In May, the company announced it would sell ValueAct Capital Partners and Silver Lake Partners for $27.10 per share, or about $3 billion.

The company has yet to set a shareholder's meeting date to approve the deal.

Ahead of the buyout, Acxiom has considered ways to cut costs, including "offshoring" jobs to cheaper work forces in other countries.

Arkansas Business reported in August that Acxiom had shown scenarios to potential buyers that projected savings of almost $25 million in the next fiscal year from such a move. Acxiom said that annual after-tax savings from offshoring could be as much as $58.8 million in fiscal year 2011.

Today's layoff also comes six months after the company acknowledged that it was terminating more employees than usual. In March, Acxiom admitted that it had eliminated about 100 employees so far in that quarter, which began Jan. 1. That was beyond the company's usual average of about 65 per quarter during the past fiscal year, it said.

At the time, the company indicated that continual small adjustments in the workforce would be "the norm."

"Throughout the year our leaders have made business decisions across the enterprise to reduce expenses; these isolated changes were done as needed to prevent wide-scale layoffs that Acxiom experienced a few years ago," Acxiom said in March.

"This will be the norm for Acxiom as we move forward - continually review business operations; then, adjust for client contract changes by ending projects in a timely manner and transferring associates to another part of the business, where possible, and eliminating positions when necessary."

Acxiom has a history of conducting rounds of large layoffs, including a move in 1999 that cut more than 200 "lowest contributors" from its work force. The cuts often come after disappointing quarterly earnings results.

 

 

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