Sunscreen manufacturer Galderma to lay off 97 employees

The Galderma company is actually planning a listing on the stock market, while, at the same time, every fifth job in Switzerland is to be eliminated. The Unia trade union is outraged by the procedure.

The Blick newspaper reported on Wednesday that a mass dismissal is taking place at the Galderma company, which has its headquarters in Zug. On request, the manufacturer of the Daylong sunscreen confirms the information: "We assume that up to 97 jobs in Switzerland are affected." In addition to Zug, Galderma also has a location in Lausanne in West Switzerland, and it’s unclear how many jobs are to be eliminated at each location. According to the Blick newspaper, the company currently has a total of 312 employees in Lausanne and 184 employees in Zug. And one in five jobs will be affected. The company writes that the affected areas would include parts of the Global Business units, Sales, and the global Operational and Central Corporate functions.

The company says that the "increasingly difficult market environment" is the reason for the layoffs. "We are facing macroeconomic headwinds in the form of inflation, supply shortages, geopolitical instability and sharply rising interest rates," a spokesman said. These factors pose a significant threat to the business "if not addressed quickly, and the company is therefore aiming to ensure an integrated and cost-effective operating structure."

Consultation process launched
The spokesman affirmed that Galderma is now committed to providing individual support for the affected employees, and a consultation with the employee representatives had been initiated. The Unia trade union had not been aware of the situation until now: "I find this very unfortunate and I can't explain why we haven’t been informed. We are not a contractual partner of the company, but we do have a wealth of experience in such cases, for example in social plans," says regional Unia head Giuseppe Reo.

Galderma's headquarters in Zug                Photo: Jan Pegoraro

In any case, he finds Galderma's justification for the job cuts a bit shallow: "Many employees are also struggling with inflation, and yet companies still get away with this, especially in Switzerland, unlike in other countries. You can’t simply decide on a mass layoff because of every small headwind," he adds. For him, the case once again shows that internationally active companies are happy to profit from Switzerland's locational advantages for years, but nevertheless apply the red pencil as soon as it comes to drastic measures, as in this case. "A little more balance should be aimed for here."

As the Handelszeitung (a weekly economic newspaper) reported, Galderma had actually planned a flotation on the stock market for the second quarter of this year. Depending on the size of the share package sold, this could have become one of the largest flotations in Switzerland for decades. According to earlier reports, Galderma was valued at over US$ 20 billion. But the flotation was then postponed for the time being due to the difficult market conditions. "A decision on the timing has not yet been made," a spokesman told the newspaper. Galderma will closely monitor market conditions to find the right time. When asked by Blick whether the current terminations would be related to the planned stock market flotation, the company did not respond.

New factory in Asia
The skincare product manufacturer previously belonged to the food giant Nestlé, and was sold in 2019 to a consortium led by the Swedish investor group EQT, which also includes companies from Singapore and Abu Dhabi, for a price of ten billion dollars. Nestlé had previously already subjected the company to a shrinkage process and, among other things, had closed the former production site in Egerkingen, Solothurn.

While jobs are being cut in Switzerland, the company is nevertheless expanding internationally. Only a few weeks ago, it was announced that Galderma wants to build its fifth factory worldwide in Singapore. According to Managing Director Flemming Ørnskov, the aim is to support the growth course in the long term and to serve customers "especially in our key markets in the Asia-Pacific region." The dermo-cosmetics business unit in particular grew by 31% year-on-year.