Kerry Packer has finally initiated action to cut a string of losses that his company, Consolidated Press Holding (CPH), has suffered in India. As part of this damage control operation, about 75 percent of staff at Consolidated Futuristic Solutions, a CPH subsidiary producing software in India, have been sacked. The Australian and North American offices of the beleaguered company have been shut down.
The software unit of Consolidated Solutions, also known as coFuture, would be doing the massive downsizing in a week. It has already reportedly sacked 25 of its 150 employees.
Packer's partner company in India, Himachal Futuristic Communications Ltd. (HFCL), holds 51 percent stake in Consolidated Software Solutions.
The mass sackings in a CPH-HFCL subsidiary have come close on the heels of the report that Packer, the owner of Channel Nine television network, had suffered huge losses from his recent investments in India.
Early last year, Packer had ventured with great fanfare into the Indian IT and entertainment sector. The unprecedented and massive investments in the Indian companies had coincided with a spate of equally impressive investments by Packer's Australian media rival Rupert Murdoch.
In March 2000, the Packer managers had announced the buying of 10 percent stake in HFCL. They had paid almost 400 million Australian dollars for their stake in the Indian company. A part of this capital was used to run Consolidated Solutions.
The CPH-HFCL combination also got a drubbing in the Indian cable television project with the decision not to bid for Doordarshan's programming slots.
The future of the venture capital fund which Packer launched with Indian stock broker Ketan Parekh and HFCL chairman Vinay Maloo is also stated to be unknown. The $250 million project has not even taken off while Parekh has been jailed for a bank scam. His financial fortunes at home also nose-dived in the last Australian financial year that finished June 30. He is reported to have lost billions of dollars in the last 12 months.