3i slashes third of workforce

The 160 redundancies represent more than a third of 3i's headcount of 435 staff. One third of those affected will be investment professionals, with the remaining redundancies targeting support staff.

In addition, 3i will close offices in Barcelona, Birmingham, Copenhagen, Hong Kong, Milan and Shanghai. This will reduce the total number of offices from 19 to 13. In addition, 3i will significantly reduce overall staff in a further six offices including Beijing, Madrid, Mumbai, New York and Singapore.

Going forward, the group will focus on investing primarily in core Northern European markets as well as Brazil. It will suspend new private equity investment in Spain and Asia. Overall, the firm will focus extensively on managing its existing portfolio and seeking exits.

3i stated the measures would save £40m by 31 March 2013, increasing to £45m by 31 March 2014. That said, it also expects a one-off implementation cost of up to £30m (including the costs associated with redundancies) to be incurred during the financial years 2013 and 2014.

"The business today is too decentralised and lacks focus and consistency," said CEO Simon Borrows in a statement. "The operating cost base has lagged changes to the investment business and is currently not aligned with the group's income [...] 3i will be a fitter and more focused organisation capable of delivering top quartile cash investment returns."

"However, it is not just about cost reduction," Borrows continued. "It is also about removing complexity from the organisational structure and changing the culture of the business to be more dynamic and focused on lower volume, higher value-driven business. A leaner organisation will remove bureaucracy and enable faster and more consistent decision making."

 

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