Global IT services provider, CSC, recently lodged a bid to acquire ASX-listed UXC (ASX:UXC) for about $428 million. Should the transaction take place, it will bring about changes for both the company’s customers and staff, according to UXC CEO and managing director, Cris Nicolli.
Nicolli told ARN that the offer is meaningful enough for its directors to refer it to shareholders for their agreement or otherwise. They will be making a choice in the coming weeks and months as to accept it or not.
“From a market perspective, both businesses are quite complementary. We very rarely compete against CSC, it tends to go after much larger opportunities like larger government deals and bigger enterprise deals. We tend to work at the next level down so it’s quite complementary in terms of where we sit in the market.
“We also have a number of partnerships with companies like Oracle and Microsoft in Australia that CSC doesn’t have strength in so it seems like a good fit,” he said.
Nicolli said the company’s existing customers will benefit greatly from the acquisition, should it take place, as CSC’s focus will widen the scope for UXC’s channel.
“Should the transaction go ahead, CSC will bring a set of capabilities and strengths to the combined company. It is strong in some vertical areas such as banking, mining and health. It also has stronger core next-generation technology platforms to what we have.
“UXC is agile and brings solutions, talent and capability, so it will offer our customers more scale and choice, which we think will be valuable to them,” he indicated.
But there are some things that will change in the process, especially in terms of staffing. According to Nicolli, for some staff, it will present significant opportunities in taking on larger projects and expanding their roles.
“There will be much more career opportunities to advance in a much bigger company, not only locally but potentially internationally as well.”
But unfortunately for some other staff, there may not be roles in the longer term because if the companies are brought together, there will be some areas of overlap.
“If this happens, I’m sure there will be some areas where CSC will decide it doesn’t need duplication. They would be typically non-customer related staff so it wouldn’t be consultants or engineers or our sales or pre-sales people but it would be more in the operational or back office environment.
“But, for most staff, there’s not going to be much change.” he said.
Nicolli also indicated that it’s too early in the pipeline to say if the potential acquisition will see UXC operate independently under the CSC banner or be merged into the CSC business.
“We haven’t gone through the five-week due diligence yet so there’s a lot to learn about both companies before we figure out what’s the best move for customers and staff. But in the meantime, other businesses can put in a superior offer which the board will have to consider if it comes to the table,” he added.