W.W. Grainger to Lay Off Up to 400

CHICAGO -- W.W. Grainger (GWW Quote) said Wednesday it will lay off as many as 400 employees amid January sales slumping 9% on weakened demand across all end markets of the maintenance products distributor.

Grainger will lay off 300 to 400 workers as a result of lower volume and the combination of Lab Safety Supply and Grainger Industrial Supply.

The company expects severance charges of $15 million to $20 million, the majority of which is expected to take place in the first half of 2009.

Annualized cost savings in the range of $25 to $35 million are expected to offset the severance charges.

Besides the layoffs, Grainger will not fill open positions, cut hours of part-time workers, eliminate merit increases for executives and salaried employees and reduce travel and relocation expenses.

Shares fell $2.10, or 2.9%, to $70.01 in premarket trading.