AMS Osram - comment

Press reports in Germany repeating the cost-cutting measures already alluded by management on recent conference calls. AMS Osram aim to lower fixed costs by 50% in its automotive and lighting segments. As of yet, there is no confirmation about the potential job losses although with eight factories worldwide, and specifically three in Germany with c. 1,300 workforce, it is likely to be closures and redundancies.  

This is part of the effort to sell non-core assets that management are undertaking with the exit of the passive Optical Components which account for €300-400m of revenue the latest low-margin business AMS Osram seeks to exit. Any asset sales will assist in further deleveraging but the refinancing of AMS Osram will centre on the new Malaysian plant and its associated growth in revenue.