RIYADH, 24 May 2007 — Saudi Electricity Co. (SEC), the largest Gulf utility firm by market value, said yesterday it plans to cut around 900 jobs without giving a timeframe.
The Supreme Economic Council recommended in a document obtained by Reuters that the firm cut 5,000 jobs over six years including 973 in the first year.
In a statement sent to Reuters, Saudi Electricity Chief Executive Ali bin Saleh Al-Barrak denied that the firm would cut 5,000 jobs saying “only around 900 employees” would be part of the retirement program.
Saudi Electricity’s spokesman Joumaan bin Ali Al-Zahrani confirmed earlier yesterday that the company had invited applications from employees for an early retirement plan, but declined to comment on the company’s targets.
“We started the plan known as the Golden Check but it’s too early to publish its details,” Zahrani said. “Stock market regulations prohibit us from commenting on these figures. We will make an official announcement in due course.” The council recommendation said the program would slash costs by SR1.4 billion ($373.3 million).
“The committee strongly recommends that the government supports this (retirement) plan,” the document said.
The first year of the plan will cost the state-controlled firm SR500 million, the document said. Saudi Electricity has been struggling to find cash to meet growing power demand in the world’s top oil exporter. No exact figures were available on Saudi Electricity’s total number of employees, believed to exceed 20,000.
Shares of Saudi Electricity closed down 2.08 percent after the news, extending declines this year to around 10 percent.