TerreStar To Slice Workforce By Nearly 50 Percent
[Satellite News – 4-22-08] Following a shakeup of its management team, TerreStar Networks Inc. is laying off nearly half of its employees in a cost-cutting measure, parent company TerreStar Corp. announced April 22.
The layoffs, which will affect 79 of the company’s 180 employees, are expected to save the company about 45 percent in base salary and expenses, TerreStar said. The headcount includes CEO and President Robert Brumley along with three other executives who resigned April 16.
Jeffrey Epstein, TerreStar’s general counsel and secretary, has been named president, but there are no plans to name a new CEO, a company spokeswoman said.
“We believe these cost reduction measures are a realistic and appropriate response to the current economic environment and are in keeping with the prudent capital financing plan we’ve mapped out,” Epstein said in a statement. “By taking these actions we strengthen our financial position while maintaining our focus on launching our satellite, developing the integrated 4G handset and delivering on our strategic vision of creating the nation’s first integrated satellite terrestrial mobile communications network. With these expense reduction measure, the company expects to be internally funded into mid-FY2009.”