Adtech prepares for more layoffs

By John Duchemin
Advertiser Staff Writer

Network test equipment maker Adtech Inc. will likely lay off more employees in the next few weeks as parent company Spirent Plc plans to get rid of 7 percent of its work force, or 500 workers, in a move to stem corporate losses.

Adtech, which laid off 30 workers in July, is one of several Spirent subsidiaries targeted for the layoffs, a company spokesperson said. Adtech has 290 employees, most of them in its Honolulu headquarters.

Spirent, a multinational telecommunications conglomerate based in Crawley, United Kingdom, announced the planned job cuts yesterday in the wake of a $380 million loss for the first half of this year and gave a bleak outlook for the rest of 2001.

The company has been hurt by falling demand for its network testing equipment, a consequence of the troubles faced by key customers including Lucent, Cisco and Nortel.

Spirent will make most of the layoffs in its North American operations — of which Adtech is a key part.

Spirent spokeswoman Cathi Lane said Adtech may be laying off workers as part of those cuts. "Being that Adtech is in North America, you could make that assumption," Lane said.

Adtech will let employees know what will happen within 30 days, Lane said.

Shares of Spirent stock fell 18 percent after the company divulged its poor first-half financial performance. The company wrote off more than $300 million in assets in several underperforming divisions, and Chief Executive Nicholas Brookes said the company will sell off assets that produce about two-thirds of Spirent's annual revenues.

Several analysts predicted the company will be a takeover target, and blamed current problems on a $1.1 billion spending spree, in which Spirent bought up 12 companies between 1997 and October 2000.

Spirent bought Adtech in 1997, paying founders Ned and Kathryn Weldon $51 million plus up to $25 million in performance incentives.

Adtech quickly grew to become one of the most profitable companies in Spirent's chain of autonomous subsidiaries. Adtech revenues topped $150 million in 2000, and company size peaked at about 330 employees.

This summer, however, Adtech has been rocked by the business slowdown, the layoffs and the July resignation of president Tareq Hoque, who disagreed with Spirent's cost-cutting plans.