CSC has moved to acquire ASX-listed IT services company UXC, it confirmed today. The move follows acquisition discussions that began in October.
UXC entered a trading halt earlier this week ahead of the announcement.
UXC said it had entered into a scheme implementation deed with CSC, with CSC to acquire 100 per cent of UXC’s shares.
If the deal goes ahead, UXC shareholders will receive $1.22 per share and an $0.02 franked interim dividend.
The price is an 8 per cent premium on UXC’s closing price at the end of last week.
The deal represents a decrease on an October move by CSC to acquire UXC which would have seen the company pay $1.26 per UXC share.
The revised proposal “reflects an acknowledgement by both parties that the synergies available as a result of the Scheme may take longer to be realised than first anticipated, a higher required working capital position than initially anticipated by the bidder and differences between US GAAP and Australian accounting standards,” UXC said in a statement to shareholders.
The new offer pegs the total value of the transaction at around $427.6 million
UXC reported FY15 revenue of $686 million. UXC has around 3000 employees.
The deal has the support of UXC’s board.
It is anticipated that UXC shareholders will vote on the deal in February next year.
“We are pleased that we have moved a step forward today toward our acquisition of UXC Limited, Australia’s largest independent and publicly owned IT services company,” Seelan Nayagam, CSC’s managing director for Australia and New Zealand, said in a statement.“This is an exciting development as a combined CSC-UXC will position us amongst the region’s largest IT service companies. When completed, this acquisition will broaden CSC’s market coverage and next-generation offerings, with an expanded client base and deeper industry expertise.”