The workforce reduction is "to reflect DragonWave's global integration plan for the recently completed takeover of Nokia Siemens Networks' microwave transport business," the microwave backhaul provider stated in a press release.
DragonWave will expand its workforce in other locations, the release added.
The release did not disclose individual office reductions, meaning it is not immediately clear how many positions will be lost in Ottawa. A representative from the company told OBJ that the firm is not providing individual office numbers for the reductions.
The company says the cutbacks will save about US$6 million annually in operating expenses, but in the short term DragonWave will incur restructuring charges.
The balance sheet for the first quarter will have restructuring charges of $800,000, and the company anticipates a one-time cash use in the second quarter of about $1.5 million.
"The thrust of the actions we have announced today is to position ourselves properly to serve our global customer set, to support our expanded product portfolio, to accelerate the rate of innovation, and to reduce costs," stated Peter Allen, DragonWave's president and CEO.
While undertaking reductions in those offices, DragonWave plans expansion in other ones in association with the acquisition. Last week, Mr. Allen said the takeover "positions DragonWave strategically for continued growth."
On Monday, DragonWave announced it has opened distribution capacity in Venray, Netherlands that is intended to complement existing offices in Ottawa and Penang, Malaysia,
In addition, DragonWave will staff new regional subsidiaries in Mexico and Brazil and plans to increase staff "in certain other regional offices," which it did not disclose.
"This global presence will augment the previously announced services arrangement between DragonWave and Nokia Siemens Networks in Italy, and an interim services agreement between the same parties that has been entered into pending the completion of the acquisition of Nokia Siemens Networks' microwave transport operations in China," stated DragonWave.
Last month, DragonWave's full-year results showed a $33.5 million loss compared with $2 million in earnings for 2011.
Revenue for fiscal 2012 fell by more than 60 per cent to $45.7 million, from $118 million in fiscal 2011.
DragonWave has said in press releases and conference calls that the NSN acquisition will be transformational for the firm, which has struggled to diversify its customer base since chief client Clearwire slowed a network buildout in 2010.
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