MVNO Lebara weighs job cuts as competition flares

Workers at ethnic MVNO Lebara Mobile have been warned of potential job cuts due to fierce competition in its markets across Europe. The company has informed its 1,400 employees that a 30-day consultation period is underway that could see up to 99 jobs under threat, according to Mobile Today.

Lebara admitted that the business needs to restructure in order to deliver on its growth objectives in a "tough economic environment." A Lebara Mobile spokeswoman told Mobile Today: "We can confirm that we are currently engaged in consultation with our employees on an internal restructure plan at UK and group level, which will ensure the flexibility we need to deliver continued business success."

However, according to the blog Prepaid MVNO, which did not cite its sources, 60 Lebara Mobile employees have already lost their jobs and a further number will be asked to leave at the end of this month.

Mobile Today reported two months ago that Lebara was putting itself up for sale, and the company confirmed that the Royal Bank of Scotland had been appointed to investigate "future strategic opportunities" that could include a sale, listing or strategic partnership. Speculation that the company was hoping to attract bids up to $1 billion failed to materialise despite talk of up to 20 companies being interested.

The company, which is often cited as a leading example for niche MVNOs, reported annual revenues of £500 million for 2010, up 50 per cent from 2009, while pre-tax profits rocketed by nearly 140 per cent to £18.7 million for the year ending December 2010. The company also more than doubled its workforce during the same period.

For more:
- see this Mobile Today article
- see this Prepaid MVNO post

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