Exertis final redundancy count expected to be 400

Around 400 Exertis UK employees now face involuntary redundancy, compared with the more than 1,000 job losses originally feared. 

The distributor is also in an advanced consultation process with another company, which may see a large number of staff transfer to a new employer as it transitions to a more games-focused portfolio.

An Exertis spokesperson told Mobile News the employee consultation process, concluded last Friday, had been “challenging, but ultimately productive in the circumstances we inherited from our previous owner”.

“During this process, which put all employees at risk, our objective was from the beginning to mitigate hardship,” the spokesperson said. “We enabled an early voluntary redundancy programme, on terms above statutory requirements, to give people more time to seek alternative employment.

“We are also embarking on a new business staffing model, focusing on becoming a specialist, independent distributor. The end result of our efforts is that fewer than 400 employees now face involuntary redundancy at Exertis UK, rather than the more than 1,000 we originally feared.”

Exertis UK’s ongoing restructuring follows several years of weak financial performance, with the business having failed to generate sustainable profits and remaining cash-flow negative well before its acquisition from DCC, according to industry sources familiar with the situation.

Once one of the UK channel’s largest players, Exertis UK has been operating with minimal resilience in a market defined by high volumes and tight margins. Insiders say profitability hovered around break-even for years and deteriorated further in the period leading up to the sale.

Sources close to the transaction suggest the UK arm lagged other parts of the wider group, some of which were performing more strongly at the time. The UK business was widely regarded as underperforming and over-layered from a management perspective, leaving it poorly equipped to absorb demand swings or margin pressure.

The restructuring process triggered alarm across the channel after initial proposals suggested a dramatic reduction in headcount from a workforce previously numbering around 1,200. Those figures are now understood to have been an opening position under UK consultation rules, rather than a final outcome.