CSC Charges Into Bidding For U.K. Outsourcer Xchanging

Solution provider CSC has jumped in and raised the stakes in a bid to acquire Xchanging, a London-based IT outsourcing firm.

CSC, based in Falls Church, Va., said in a statement that it’s offering $2.58 a share for Xchanging, more than a month after it had agreed to be bought out by Capita plc, another U.K.-based outsourcing company, for $2.43 a share.

Private equity firm Apollo Global Management, of Purchase, N.Y., was also locked in battle with Capita for Xchanging, but according to published reports, Apollo withdrew from discussions last week.

[Related: CSC To Complete Split Nov. 27, Will Name Public Sector Business CSRA]

Capita said the value of its bid for Xchanging was about $627 million. CSC’s offer reportedly tops that, at $640 million, according to the investment website Seeking Alpha.

Xchanging, which also offers business process outsourcing and procurement services, is the fourth company CSC is looking to acquire this year. Later this month, it’s scheduled to split into separate commercial and U.S. government companies

CSC - No. 5 on CRN's Solution Provider 500 list - acquired managed trading solutions provider Fitnetix and service -management solutions provider Fruition in September, less than a month before it announced plans to acquire Australian IT application and infrastructure consulting firm UXC to bolster its $8.1 billion commercial business.

CSC also reinforced its $4.1 billion U.S. public sector business by merging with $1.4 billion competitor SRA. That merger is expected to close Nov. 30, after the combined company’s stock begins trading on the New York Stock Exchange under the name CSRA.

Shares of Xchanging gained more than 7 percent Thursday in the final 90 minutes of trading on the London Stock Exchange.

PUBLISHED NOV. 12, 2015

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