As vnunet.com predicted, beleaguered Baltimore Technologies confirmed today that mounting losses have forced it to lay off 220 workers and sell its Content Technologies email security subsidiary.
The moves form the core of a restructuring plan designed to secure annual savings of £72m.
Paul Sanders, acting chief executive of the Irish security firm, who stepped in after previous incumbent Fran Rooney resigned in July, attempted to add a positive note to the spin off.
"The fundamental conclusion for the restructuring process was that these are two separate businesses, and we believe that both will be valuable in their own right. But within a single group, and within our resources, we can't give these businesses the time and focus they need," he said.
He admitted that there was not currently an offer on the table for Content Technologies and refused to speculate on what price tag was being put on the subsidiary. However, analysts consider it very unlikely that Baltimore will recoup the £692m ($1bn) which it paid for the company in an all-share deal last October.
Sanders thought that the second quarter of 2001 would represent the nadir of the firm's financial fortunes. "In our view Q2 was a trough for Baltimore. There's been an impact from the global downturn but there have also been specific issues to Baltimore, including a lot of talk about whether we would survive," he said.
In the six months to 30 June, Baltimore declared pre-tax losses of £550.3m, compared with losses of only £25.5m for the same period in 2000.
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