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Scitec severs networking arm

Scitec severs networking arm

Communications company Scitec has agreed to sell its Australian Communication Solutions business to vendor Marconi for around $70 million in cash, so it can reinvent itself as a voice-enabled e-commerce solutions company.

Paul Magee, managing director at Scitec, said the sale would allow it to focus on the voice-enabled e-commerce side of its business.

"It all comes down to a corporate strategy to focus on areas where we can be globally successful," Magee said. "We had three excellent businesses in products, services and voice-enabled technologies and decided if we were going to be the very best we could be, we had to focus on one area."

Magee said it made its decision to focus on the new and emerging e-commerce area because italready had a leadership position in this part of the world and the cash generated from the sale of itsnetworking services business would allow it to move forward aggressively. Scitec will now change its name to VeCommerce.

At end of last year Scitec sold its product manufacturing business to Datacraft Technologies (recently renamed CommsCraft), which included Scitec's FastLane voice data multiplexes and its SAT access devices.

Scitec's sale of its network services business to Marconi includes all its branches around Australia, 120 staff and its 800-strong customer base, to whichit provides services such as network design andintegration.

Magee believes it is a "win-win situation. Istruggle to see any downside at all," he said.

Tim Geerarts, general manager Australasia at Marconi, said the Australian Communications Solutions business would operate as a services unit within Marconi in Australia.

"It will continue to go out and provide best-of-breed solutions to customers," Geerarts said.

According to Geerarts, it was a strategic move by Marconi to develop a stronger local presence and service its customers in Australia and the Asia-Pacific. "What this acquistion is about is supporting ourcustomers and partners," Geerarts added.

All staff have been briefed and the sale is expected to be completed by late March, Geerarts said.

The sale is conditional upon approval from shareholders and the Foreign Investment Review Board (FIRB). If FIRB approval is not obtained, Marconi must pay costs of $4 million to Scitec. If shareholder approval is not obtained, Scitec must pay costs of $4 million to Marconi, the companies said in a statement.


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