Israel operator Cellcom announced it would make substantial cuts to its workforce as part of a programme to slash ILS150 million ($43 million) from annual operating costs, citing continued intense competition in the sector.
Other measures to improve the company’s financial position include a reduction in cash paid to suppliers and reducing costs related to wholesale fixed services. In addition to slashing its operating expenses, capex will be limited to ILS500 million per year.
The operator plans to begin the redundancy process in October with measures to reduce operating expenses set to be realised by the end of 2020.
In a statement, Cellcom warned the restructuring programme and associated cash raising measures could entail “significant one-time expenses”.
The company’s CEO Nir Sztern cited challenging market conditions for the move, while chairman Ami Erel said the restructure would “enable the company to participate in mergers, acquisitions and other opportunities that may present themselves in the telecommunications arena in the next few years”.
The restructure follows a wide-scale investigation into its business and assessment of how it can compete with low prices in the Israeli communications market.
Cellcom is the largest of the country’s mobile operators by connections, according to GSMA Intelligence figures for Q2, with a 28 per cent market share.