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Sun Forced to Slash and Burn

Sun's delayed acquisition by Oracle forces the computer maker to cut its global headcount.




Sun Microsystems


has announced plans to

cut 3,000 jobs

as the tech giant awaits

EU approval

of its

$7.4 billion

acquisition by


(ORCL) - Get Free Report


The deal has already been


by Sun shareholders and the


, but has been delayed while European regulators scrutinize the merger's antitrust implications. Officials are mainly concerned about


getting its hands on Sun's MySQL database and thus limiting the choice for database software.

Oracle had originally intended to close the deal sometime during the summer, but Brussels had other ideas. The European Commission is expected to make a decision on whether to approve the merger by Nov. 19, according to



Sun revealed the headcount reduction in a filing with the

Securities and Exchange Commission

Tuesday, explaining that its hand was forced by the delay in closing the deal. The firm will now cut 3,000 employees over the next 12 months, incurring charges between $75 million and $125 million. Most of the charges will be incurred in the second and third quarters of fiscal 2010, it added.

Oracle CEO

Larry Ellison

has already


that the European Commission's probe is costing Sun $100 million a month, and the deal faces

stiff opposition

from pressure groups on both sides of the Atlantic.

With rivals


(HPQ) - Get Free Report



(IBM) - Get Free Report

keen to exploit any uncertainty and lure Sun customers onto their own technology, Oracle wants to get the deal done as quickly as possible

Sun is no stranger to restructuring efforts and attempted to streamline its business long before Oracle's bid. Last November, for example, the troubled computer maker announced plans to cut up to 6,000 jobs, or 18% of its global workforce, as the firm attempted to breathe life back into its struggling business.

The company's stock was flat in extended trading Tuesday.

-- Reported by James Rogers in New York