PW: Quebecor Takes Large Integration Charge

Quebecor World will take a $180 million pretax charge in the fourth quarter of 1999 to reflect restructuring charges connected with integrating World Color Press into Quebecor's existing operations. Quebecor acquired World Color Press last summer in a deal that formed North America's largest book printer (News, July 19, 1999).

Under the restructuring plan, Quebecor will close an unspecified number of U.S. plants over the next 18 months. The company has already completed the integration of Quebecor and World Color's sales and corporate services operations. Although Quebecor declined to say how many jobs it expects to eliminate, it said it is confident that it can "significantly reduce our employee count." Reports in the Canadian press put the layoffs at 2,000.

The printer noted that the majority of the $180 million write-down will consist of severance payments as well as write-offs of surplus equipment and buildings. Quebecor projects that annual savings from the restructuring will be C$100 million, more than double its initial estimate when the company first announced its merger with World Color.