PeopleSoft begins merger-related cuts

Enterprise software maker PeopleSoft has initiated previously announced layoffs related to its $1.8 billion acquisition of rival J.D. Edwards.

PeopleSoft confirmed Thursday that it has begun letting go of employees, with plans to eliminate approximately 7 percent of its newly combined work force. The layoffs will result in the loss of roughly 750 to 1,000 jobs between now and the end of first quarter of 2004, according to company spokesman Steve Swasey. He declined to say how many employees had been laid off so far.

The reductions are being based solely on redundancies between the two software makers, he said. The combined PeopleSoft-J.D. Edwards has a staff of about 13,000.

"This is the result of having duplicate positions in the two companies," said Swasey. "In order to realize many of the efficiencies offered by this merger, it's naturally required to eliminate some overlap."

PeopleSoft hasn't detailed whether the job cuts would be concentrated on the J.D. Edwards staff or on its own work force. PeopleSoft Chief Financial Officer Kevin Parker had said previously that the layoffs would target redundant administrative, marketing and middle-management positions, leaving development, sales and consulting staff untouched.

The reductions would be relatively small, Swasey said, compared with nonpersonnel cutbacks taking place in the two companies' business operations, particularly their marketing budgets and internal infrastructures.

PeopleSoft CEO Craig Conway first detailed the layoffs in early September, announcing a goal of eliminating $167 million to $207 million in duplicate costs between the two companies. At that time, Conway reiterated his belief that any cuts stemming from the merger would result in overall growth of the company, rather than the elimination of creative positions or a reduction in the products made available to the enterprise software market.

Conway has taken pains to distinguish the J.D. Edwards acquisition from the hostile takeover bid that PeopleSoft continues to fight off from rival Oracle. While Oracle CEO Larry Ellison acknowledged early in the effort to buy PeopleSoft that he planned to phase out the company's enterprise resource planning and customer relationship management applications, Conway has repeatedly said that PeopleSoft and J.D. Edwards have complementary, rather than competing, products.

CNET News.com's Alorie Gilbert contributed to this report.