PMC-Sierra (NASDAQ: PMCS), maker of storage and broadband semiconductors announced a cost reduction initiative late Thursday, with plans to cut jobs and close offices to reduce operating expenses by $20 million to $24 million a year.

The restructuring is part of the firm's strategy to improve its operating performance and will include elimination of 175 jobs across the company, as well as closure of R&D centers in Winnipeg, Manitoba, and Saskatoon, Saskatchewan.

These initiatives will better align our efforts on our strategic customer engagements in the Fiber To The Home, enterprise storage, and other communications infrastructure product areas, said Bob Bailey, Chairman and CEO of PMC-Sierra.

The cost cutting will save the firm between $20 million and $24 million, a move Srini Pajjuri of Merrill Lynch believes is necessary.

Given the current market conditions and the company's expense structure, we would have liked to see more aggressive cuts but view management's actions as a step in the right direction nevertheless, he said.

Shares of PMC-Sierra rose 79 cents, or 12.5 percent to $7.09 on the Nasdaq Stock Market.

NASDAQ OMX Group Merrill Lynch California