Sunnyvale, California-based First Pacific Networks Inc is making 21 full-time positions redundant from the direct marketing sales force and restructuring itself in a bid to save money and refocus the company. And it says it will probably need to raise more cash to support its operating activities and to implement its strategic plan. First Pacific Networks is scaling back its direct marketing operations because it now has alliances with companies, including L M Ericsson Telefon AB and Bosch Telecom GmbH which will sell its products in the US and overseas. First Pacific Networks says it is now going to concentrate on manufacture, installation and field service of systems sold and distributed by these partners. Although it is the direct marketeers that will bear the brunt of the redundancies, representing a loss of 10% of all staff, the technical and management division will be affected by the restructuring. But the company said that that once the restructuring is complete it is likely that new technical sales support staff will be hired. It estimates that redundancies, reassignments, reductions through attrition and expiration of no longer required consulting agreements, net of planned new hires, should cut its costs by some $200,000 to $300,000 a month over the next several quarters. But despite these savings Kenneth Schneider the company’s financial officer said that First Pacific Networks would need additional capital although he did not say how up much. Last November First Pacific Networks concluded a $9.4m equity financing which has been spent on research and development, sales and marketing and capital investment. In 1993 it raised around $17m in a 2.5m share issue, 817,000 of which were new shares (CI No 2,264) whgich was spent on supporting operations and product development. Schneider said, We’re evaluating different financial alternatives and we do intend to raise extra funding and that may or may not be through equity funding. A new First Pacific Networks International has been established to push the firm’s hybrid fibre-coaxial digital broadband transport technology which enables speech, video and data to be transmitted simultaneously over coaxial and hybrid fibre-coaxial wiring systems to large numbers of users in the international telephony world.
