Struggling PC vendor AST finally announced that it was withdrawing from the European PC and server market and slashing its workforce to concentrate on notebooks.
AST, acquired by Samsung last September, said radical restructuring will halve its European payroll over the next two months.
Officials said the cuts would not fall on any one area of the organisation, but certain losses will come when AST relocates its Irish manufacturing plant in Limerick - which employs 430 people - to a smaller plant in the same region employing only 135 people.
Rod Rodericks, senior vice president of AST, said: 'AST has made it clear that it needs to take drastic action to drive its return to profit. As part of that strategy, AST Europe has had to focus on its most profitable area of business.'
Officials pinned most of the blame on the recent economic turmoil in the Far East, but AST has seen a steady fall in its PC market share since 1996. Its share in the fourth quarter of 1997 was just over 2.5 per cent worldwide, compared to market leader Compaq with 43 per cent, according to Dataquest.
In a letter issued to AST's UK distributors and resellers - which was obtained by PC Dealer - Con Mallon, marketing director of Europe, played down the extent of the cuts, saying: 'AST is confident that a stronger, notebook-focused organisation will secure it a long-term future in the European notebook market.'
A representative at Northamber - AST's main distributor in the UK - claimed it would not be adversely affected by AST's market shift. 'It has discussed it with us all the way and we don't have any planned restructuring or job losses,' he said.
AST Europe's shift in emphasis takes effect from 1 February.
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