I recently wrote a blog post about how Sir Brason has been sacking his employees from his newest company Virgin Media. The company, which was a merger between previously ailing NTL and Telewest in UK, has been running i n loss and its a common knowledge that Sir Branson is trying to get rid of it. Read my post either at my blog or here at:
If you have been following the recent events please comment back. Cutting on headcounts has been a common corporate mantra for cutting costs these days especially with outsourcing such an easy option. What do you guys think?
Thats what i used to think untill i met these guys in Liverpool who were shown the door by Virgin bosses after working in the company for 7 years. One of them wept quietly and other rattled and so a deal was struck in a local hotel to pay him compensation to keep it under covers.Unfortunately, there are about 30 more got sacked yesterday, with no compensation. I used to respect Sir Branson, but its clear here what his motives are!
I have not been following the story at all and know nothing about Virgin Media. But if you think it is clear what his motives are, then what do you think they are? You didn`t say.
Well, Bransons motives are crystal clear: to sell off the company. Earlier this year there was a proposal from The Carlyle Group of US, for $23Billion. Virgin deems it `very low`. Obviously I can comment on what happened during that bid refusal period, but Virgin CEOs must have re assessed their situation and company`s worth. Virgin Media was bought by Branson with a few billion dollars debt carried over from NTL and Telewest. Now to increase any company`s resell value, you need to improve on two aspects:
1) Control or reduction in existent debt,
2) Control of Costs,
Very obviously soon after the bid refusal, company started charging its customers for technical customer support. And staff sacking and redundancies increased manifold.Now if these are not cost-cutting measures what else! With a profile of millions of customers and ongoing costs and debt reduced, Branson is on a lookout for high-paying buyers.
I predict within 6 months. Lets see.