Posted By Rich Miller On January 5, 2006 @ 9:45 am In Deals | Comments Disabled
Private-equity players have been diving head-first into the business of computer outsourcing, in which corporations contract out their computer-maintenance and operations to the likes of CSC. The outsourcing companies generate huge streams of cash, a quality that private-equity firms seek because they can then put a lot of debt on the companies they acquire and produce greater returns for their investors. At the same time, though, these outsourcing companies are in a highly competitive market that is being transformed by low-cost providers in India and throughout Asia.Both CSC and ACS operate significant networks of data centers, so any buyouts could lead the acquirer to assess the cost-effectiveness of the networks, particularly if the buyer (HP, for example) may have data centers of its own in some of those markets. Stay tuned … we should hear more about both of these deal stories in coming days.
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URL to article: http://www.datacenterknowledge.com/archives/2006/01/05/buyout-deals-rumored-for-computer-sciences-acs/
URLs in this post:
 Computer Sciences Corp: http://www.csc.com/
 Journal story: http://online.wsj.com/article/SB113643521747638397.html?mod=home_whats_news_us
 summary: http://money.cnn.com/2006/01/05/technology/hp_computersciences.reut/
 Affiliated Computer Services: http://www.acs-inc.com/
 Rich Miller: http://www.datacenterknowledge.com/archives/author/richm/
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