Lockheed Martin has decided to reduce its workforce once again. While six months ago it let go of 500 employees, this time around, it plans to release "less than 200" positions based across the world, according to Dan Nelson, Lockheed's communications director.
The Maryland-based defence company is letting go of its IT staff working in its Information Systems & Global Solutions (IS&GS) unit. The move follows Lockheed announcing in January that it had entered into a definitive agreement to separate and merge its IS&GS unit with Leidos, the Virginia-based defence company that provides engineering, systems integration, and technical services.
The current job cuts are part of this merger process, a company spokesman said. Meanwhile, Nelson said the cuts are necessary for the company "to remain competitive", according to the Washington Post.
Marillyn Hewson, CEO at Lockheed Martin, had at the time of the merger announcement, said: "This strategic transaction is an important milestone in the portfolio reshaping strategy we announced in July 2015 and allows us to focus on our core business in aerospace and defence."
The $5bn (£3.49bn, €4.43bn) merger is expected to allow Lockheed to renew its focus on the F-35 Joint Strike Fighter it builds for the Pentagon and on other items.
"The combination of our proven IT and technical services businesses with Leidos will create a new leader in the government IT sector with a diversified portfolio, greater scale and improved efficiency," Hewson had said.
Under the deal, which has been structured as a tax-free Reverse Morris Trust, Lockheed will get three seats on the board of the merged company. Also, while shareholders of Lockheed Martin will receive 50.5% share in the merged entity, Leidos shareholders will own the remaining stake. Leidos would, however, run the operations of the new merged company.