Published on the 26/05/2016 | Written by Newsdesk

Fresh on the heels of its recent takeover of Australasian services company UXC, CSC is looking to merge with Hewlett Packard Enterprise…

Announcing its intent to merge with the Enterprise Services segment of Hewlett Packard Enterprise (HPE), CSC said the combination of the two businesses will create one of the world’s largest pure-play IT services companies focused on driving digital transformation in its client base.

The new company is expected to have annual revenues of US$26 billion and more than 5,000 clients in 70 countries.

The merger is expected to be completed by the end of March 2017, subject to shareholder and regulatory reviews and approvals. Following the transaction, CSC and HPE shareholders each will own approximately 50 percent of the new company’s shares.

Six months ago, CSC separated into two publicly traded companies: CSC, to serve commercial and government clients globally, and CSRA, which serves public sector clients in the United States.

Following completion of the transaction, Mike Lawrie, who currently serves as chairman, president and CEO of CSC, will become chairman, president and CEO of the new company. Meg Whitman, HPE’s president and CEO, will join the new company’s Board of Directors, which will be split equally between nominees of CSC and HPE.

“Our proposed merger with HPE Enterprise Services is a logical next step in CSC’s transformation,” Lawrie said in a statement. “As a more powerful and versatile global technology services business, the new company will be well positioned to innovate, compete and serve clients in a rapidly changing marketplace. We are excited by the great potential this merger brings to our people, clients, partners and investors, and by the opportunity to strengthen our relationship and collaboration with HPE.”

For her part, Whitman said, “The ‘spin-merger’ of HPE Enterprise Services with CSC is the right next step for HPE and our customers. Enterprise Services’ customers will benefit from a stronger, more versatile services business, better able to innovate and adapt to an ever-changing technology landscape.”

“The ‘spin-merger’ of HPE Enterprise Services with CSC is the right next step for HPE and our customers.”

The merger represents a major step in CSC’s post-separation strategy, the company said, noting its positioning as a ‘next-generation IT services company built specifically to respond to a changing market – one that is driving clients to move rapidly toward digital transformation’. It cited the recent acquisition of UXC as a part of this strategy.

“Clients are feeling the pressure to digitally transform their enterprises to meet new business demands and customer expectations,” Lawrie said. “They need a partner with the innovation, scale, leadership and dependability to answer the challenge.”