In a move expected since August, Motorola Mobility declared Monday that they would be shutting down operations in South Korea by next year, laying off 500 workers and no longer marketing or selling phones in the country.
The shutdown, which is part of a reorganization made by Google, which acquired the telecommunications company earlier this year, was confirmed by a company spokesman to PC Magazine in a Monday article.
"On December 10th, we began communicating to staff in Korea our plans to close most of our operations in Korea, including our research and development and consumer mobile device marketing organization," the spokeswoman said. "The changes in Korea reflect our plans to consolidate our global R&D efforts to foster collaboration, and to focus more attention on markets where we are best positioned to compete effectively."
The decision to close operations in South Korea will mean that at least 500 workers will be cut, although those workers are expected to receive compensatory pay as a result.
The closing of the company's South Korea operations had been seen as a likelihood after Google laid off 4,000 workers at their acquired company in August following their acquisition.
Following that, the company in October filed papers with the U.S. Securities and Exchange Commission stating that Google was expected to "broaden those actions to include additional geographic regions outside of the U.S."
As eWeek.com reports, the parent company has not been clear as to whether those broadened actions would mean further job cuts.
Google had purchased Motorola Mobility for 12.5 billion--a deal that enabled Google to acquire more than 17,000 patents from Motorola--but restructuring costs have made this a more expensive deal for Google, the resulting price tag now at $13 billion, according to ZDNet.
The shutdown of Motorola Mobility marks similar moves by smart phone maker HTC and Yahoo, both of which shut down their bases in South Korea previously.
However, the move does not mean that Motorola Mobility will not maintain some of its presence in South Korea. Company officials say that at least 10 percent of its local research and development staff who will be offered relocation packages to stay in Korea, while they will also retain two of their current business units.
However, the company will no longer offer smart phones or marketing existing ones in the country.