‘We’re on our way to bankruptcy’
Insurance giant HCI is preparing to shut down its Irish operations and will lay off thousands of people in a massive restructuring in a move aimed at staving off a possible insolvency warning.
Key points:HCI will close 1,600 offices in the country as part of its restructuringThe company said it would have to reduce its workforce by 5 per cent to meet its debt targetsThe Irish Financial Services Authority (IFSA) is to hold a meeting on Friday to discuss the restructuringHCI is set to close 1 and 1.5 million offices in Ireland, the Irish Financial Management Company (IFMC) said in a statement on Friday.
The company is set the Irish capital at around £6 billion ($10 billion) and the majority of its offices are in Cork, Dublin, Cork city, Wicklow, Kilkenny, Galway, Kerry, Galle and Limerick.
The Irish Times understands that HCI will layoff 5,000 people in the process, while the majority will be laid off in Cork and Dublin.HCI had a net debt of about €1.8 billion in the second quarter of 2017, according to Irish financial data agency INSEE.
The company’s total debt was €2.2 billion at the end of March.
The restructuring will involve the restructuring of the company’s operations, its financial management team and the IT, data, human resources and supply chain teams.
The group said the restructuring would cost it approximately €2 billion in restructuring costs and an additional €2 million in compensation costs.
The head of the IFMC, Paul McQuaid, said that the restructuring process would be completed in the first half of 2018.
In a statement, the company said that “as part of the restructuring plan, we have committed to fully privatising our IT, IT services and information technology assets.”
We are confident that the financial results of our IT business will be better positioned in the future.”HCI, which was founded in the US in 1984, has a total of approximately 15,000 employees across the world, according the company.HCA is one of the largest insurance companies in the world.
It provides financial, medical and personal services and also provides health insurance.