The company said the move will cut 2,500 workstations from its total of 18,000. Along with other cost-cutting measures, it will deliver savings of between £8 million ($11.4 million) to £10 m ($14.2 million) in the current financial year and up to £16 million ($22.8 million) in the first full year to June 2003.

Three of the centres earmarked for closure are in Europe and two are first generation UK centres. And the planned centre in Madrid will not now open with the building being handed back to the landlord prior to fit-out. While the group's mature centres, especially in London and Paris, are now seeing occupancy levels recovering to around 80% since the August slump, the company conceded that newer centres are taking longer to lease. And licence fee levels continue to be under pressure.

MWB Chief Executive Richard Balfour-Lynn said: 'While the business environment may be tougher today than it was a year ago there is little doubt that our serviced office model is sustainable particularly in the UK where property leases are so inflexible.'