Cooper Will Cut 1,000 Jobs, Close 12 Plants

Cooper Industries Inc. said Monday that it will cut 1,000 jobs, or 3.6% of its work force, and close 12 plants worldwide in an attempt to cut costs and improve profit after the recent sale of its automotive products business.

Houston-based Cooper, which makes tools, hardware, electrical products and lighting, plans to eliminate the jobs through a combination of “voluntary and involuntary separations.”

Cooper said it will consolidate manufacturing operations in lower-cost facilities, including some in Mexico. It now has 110 facilities, including about 50 in the U.S.

The cuts in both plants and jobs are likely to be spread across the company’s geographic areas, spokesman John Breed said. He said the company cannot be more specific about the job cuts until it sees the response to its voluntary termination offer.

Cooper will take an unspecified charge in the fourth quarter to cover the expenses of the cost-cutting program, but it said the charge will be more than offset by an unrelated one-time gain also taken in the fourth quarter.

The gain relates to the transfer of 16.5 million of Wyman-Gordon Co. common shares the company acquired when it sold a division to Wyman in 1994. Cooper subsequently issued debt convertible into the Wyman shares, which matures in the fourth quarter.

The company expects the cost savings to make a difference beginning in 1999’s second quarter, with full benefits to be realized in 2000.

At least one analyst lowered earnings estimates for Cooper on Monday, according to Chuck Hill, director of research for First Call Corp., which tracks estimates. That brought the analysts’ consensus estimate down a penny to 76 cents a share for the fourth quarter before special charges. That would compare with 90 cents for the year-earlier period.

Cooper sold its automotive business to Federal-Mogul Corp. in October for $1.9 billion.

The new cost-cutting continues efforts to reshape Cooper to focus on higher-growth and less volatile businesses, Chairman H. John Riley said.

Cooper shares fell 31 cents to close at $47.13 on the New York Stock Exchange.