(By Balaseshan) Computer Sciences Corp. (NYSE: CSC) said it has agreed with South Africa's employment services company, Adcorp, for the sale of its Australian IT staffing unit - Paxus.
This agreement, CSC's third divestiture in seven weeks, advances CSC's transformation strategy to rebalance its portfolio of services. The total value of this all-cash transaction is expected to be $73.5 million.
"We do not anticipate any impact on CSC's core services and clients in Australia, and we expect to use after-tax proceeds for general corporate purposes," said Mike Lawrie, president and CEO of CSC.
Adcorp's decades-long history in the staffing industry will ease the transition for Paxus's clients and employees. After the closing, CSC will continue a business relationship with Paxus to meet its IT staffing needs in Australia.
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In fiscal 2012, revenue from Paxus was about $340 million with low single-digit operating margins. Paxus's results will be recast as discontinued operations in future periods. Paxus's results had been previously reported within CSC's Business Solutions and Services segment.
The companies expect to close the transaction by the end of January 2013. CSC acquired Continuum and its Melbourne-based Paxus business unit in 1996.
"This portfolio-shaping transaction is the latest step in CSC's transformation. We are aligning the company's resources with our strategy of leading the next generation of solutions and services," said Lawrie.
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CSC closed Tuesday's regular session up 0.43% at $39.28. The stock has been trading between $22.18 and $40.34 for the past 52 weeks.