MADISON, N.J. (AP) -- Medical laboratory operator Quest Diagnostics Inc. said Thursday it will cut 400 to 600 management positions and reorganize its business.
Quest will eliminate three layers of management and reorganize into two business units, diagnostic information services and diagnostic solutions. It expects to save $65 million a year from the changes. The company has around 42,000 employees. Quest expects to take $15 million to $20 million in charges associated with the restructuring and job cuts.
The reorganization will take effect by Jan. 1, and job cuts will be complete by the end of 2013. Quest announced in mid-2011 that it would eliminate 500 jobs as part of a larger plan to cut $500 million in annual spending over the next three years and said Thursday's moves were part of that plan.
Quest said the diagnostic information service division will bring in almost all of its revenue. It will include the company's physician services, hospital services, and cancer diagnostics units. Quest said it is hiring Everett Cunningham, formerly with Pfizer Inc., to lead its commercial business; John Haydon, previously with Phillips Electronics, as head of operations; and Jeffrey Shuman as its chief human resources officer. Shuman was with Harris Corp.
Richard Mahoney, who leads its health care information unit, and Joan Miller, who is in charge of the oncology and neurology services business, will leave the company by the end of 2012. Vice President of Human Resources David Norgard will also leave by the end of the year. Joseph Benage, the head of its insurer and employer unit, will leave in 2013.
Shares of Quest Diagnostics rose 83 cents to $64.24 on Thursday.