CSC has signed a binding scheme of implementation for the acquisition of UXC Limited, in a deal that will create the largest IT service provider in Australia.
The companies had been performing due diligence since they announced the intention to merge in October. That phase has now completed successfully, with the ASX notified today that a binding deal has now been signed.
The acquisition value comes to $427.6 million based on a transaction of 345 million UXC shares. Shareholder, regulatory and legal approvals are now pending, with the historic merger expected to complete by February.
Put together, CSC Australia ($724 million) and UXC Limited ($686 million) would generate more than $1.4 billion annual revenue and have 5,100 employees, putting it among the two largest Australian IT service providers in the country.
By comparison, Dimension Data expected to turn over around $1.25 billion after acquiring Oakton. ASX-listed Data#3 raked in $870.5 million of revenue this year.
“We look forward to the prospect of the UXC team joining CSC,” said Mike Lawrie, CSC’s global president and CEO.
“The addition of UXC would continue the process of rebalancing our offering portfolio and strengthening our global commercial business. UXC’s application platform capabilities – combined with CSC’s existing strengths in cloud, cyber, and big data – would enhance what the two companies already deliver to clients in the region.”
UXC Limited and CSC Australia have experienced contrasting fortunes in recent times, with UXC Limited celebrating a $43 million improvement in revenue while CSC Australia copped a $127 million fall this year.
UXC’s high-profile chief executive Cris Nicolli last month revealed his plans to retire upon the completion of CSC merger, bringing the curtain down on a 13-year career with the service provider and a leadership stint that oversaw organic and acquisition growth both in Australia and North America.
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