Dust settles over Memorex Telex acquisition

Dust settles over Memorex Telex acquisition

Just over a month into NCR's acquisition of Memorex Telex the dust appears to have settled, with NCR reporting the buyout has given the company a real future in global markets.

Josh Claman, NCR's Asia-Pacific VP of customer services, said while he concedes some former Memorex Telex staff may feel disenfranchised by the buyout, it was never intended to compete with staff plans for a management buyout offer (MBO).

"We were taking a fundamentally good business and giving it a future," he said.

At the time, Memorex Telex staff were considering a management buyout to secure the company's future in the face of financial troubles.

"I was only aware [of the MBO] six or seven days before close [of negotiations]," Claman said.

He commented he was surprised by the "mixed" press at the time, quoting disgruntled employees, stating confidentiality agreements meant NCR was only able to communicate directly with Memorex Telex parent Kanematsu.

Claman said he believes NCR acquired what was essentially a good company with good customers, sales and technical people but a "sick balance sheet".

In addition, he commented he has trouble believing the MBO option was viable. "The same reasons we saw [Memorex Telex] as attractive a few years ago were still there," he explained of NCR's decision to approach Kanematsu again some four months ago.

The company is now focused on building its network services business. "Strategically we need to gain credibility in all our markets around the world," Claman said.

Meanwhile, aside from a number of resignations at the former Memorex Telex, less than 10 people have been made redundant as a result of the acquisition. "If you talk to [ex-]Memorex Telex people today, you will find they are happy," he said.

NCR is also looking to add at least two more companies to the portfolio before the year is out, added Claman.

Memorex Telex is now part of NCR's worldwide customer services business, which has global revenues of $US2.9 billion and represents 40 per cent of the company's entire revenues.

NCR's Asia-Pacific business represents around 20 per cent of its global market. "We expect to double our size in two years" Claman added.

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