Services giant Wang Global announced late yesterday it has agreed to a $US2 billion buyout offer from Dutch information services company Getronics.
Getronics is expected to offer $29.25 a share for Wang to create a company worth $US5 billion with 33,000 employees, operating in 40 countries, and specialising in desktop and network services.
The deal will see the smaller Getronics attempt to swallow a significantly larger Wang that boasts revenues of $US3.5 billion and 20,000 employees spread across 1000 facilities worldwide, according to a report in the Wall Street Journal yesterday.
The report states, Geotronic's chief executive, Cees Van Luijk, has been agressively trying to expand the company's business from its computer reseller roots.
It appears, however, the company has a tough job ahead reconciling Wang's troubled history.
The report notes Wang ended the most recent fiscal year with a loss of $US281.6 million on revenue of $US1.89 billion.
Since emerging from bankruptcy protection in 1993, Wang began acquiring a raft of companies in an attempt to crack the professional services market dominated by companies such as IBM and Compaq, the report notes.
Local Wang executives were not immediately available for comment.
However, one local source speculated it is unlikely Wang will lose its name and branding in Australia as Getronics does not have a presence here or in the US.
The company's operations are concentrated European countries such as Holland and Belgium, Norway, Denmark, Scandinavia and Spain.
The deal still needs approval by U.S. and European regulatory bodies, and may also require the cooperation of Olivetti, which retains a 20 per cent stake in Wang Global. The deal also depends on Getronics being able to acquire at least 51 per cent of the Wang Global stock.
Van Luijk said the bid was a friendly one and had been welcomed by the Wang Global board. But he could not say if the two Olivetti representatives who sit on the Wang Global board were in favor of the deal.
"We expect to meet with Olivetti quite soon," he said