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The consolidation was not unexpected following Sanmina's acquisition last year of SCI, another major company in the USD100 billion contract manufacturing sector.
The company, now known as Sanmina-SCI, is involved in the creation and assembly of printed circuit boards as well as cable systems and enclosures for telecommunications equipment and networking systems.
The combined company employs more than 735 people in Ireland, including 600 in Fermoy, Co. Cork and 133 in its Blanchardstown assembly plant and its Limerick customer services facility. It is not known whether the consolidation will affect the Limerick facility.
Operations from the Blanchardstown plant are to be relocated to the facility in Fermoy. Some staff from Dublin will be given the option of transferring to Cork or to one of the 100 other global facilities in the Samina-SCI group, but the majority of jobs are expected to go.
Seamus Grady, vice president and general manager of the Dublin facility, said the similarity of the operations in Dublin and Cork and the current business climate left the company with no alternative but consolidation. The company is known to have received grants from the IDA which will be transferred to the Cork operation and therefore will not have to be repaid despite the closure of its Dublin facility
Over the past year Sanmina has been on the acquisition trail, including its purchase last October of assets of the Northern Ireland subsidiaries of E-M-Solutions, an enclosure manufacturer. But the company has felt the squeeze of the downturn as its clients are focussed in the telecommunications, data networking and high end computing industries. Rival contract manufacturers, including Flextronics and Celestica, have also suffered and together cut some 500 jobs from their Irish operations last year.
Shareholders approved Sanmina's purchase of SCI in December, one of the largest mergers in a depressed year for the technology industry. Under the terms of the merger, SCI stockholders received 1.36 shares of Sanmina common stock for each share of SCI common stock.
The value of the deal tumbled from USD6 billion to USD4.9 billion purchase when completed due to the fall in the companies' share prices. But the companies also revealed in December that the merger would generate some USD200 million in savings in the first year alone, around USD50 million more than first estimated.
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