DXC Technologies, the merged business formed out of CSC and HPE Enterprise Services, has formally opened for business today. The new company will have annual revenues of about $24bn, generated from just under 6,000 clients in more than 70 countries.
The company started trading on the New York Stock Exchange today under the predictable ticker symbol 'DXC'.
The emergence of DXC Technologies is the culmination of a spin-off of HPE Enterprise Services masterminded by HPE CEO Meg Whitman. Announced in May 2016, Whitman claimed that the 'spin-merge' would "unlock value" for HPE shareholders, who will own 50 per cent of the new company.
However, former CSC CEO Mike Lawrie, best known in the UK for his leadership of software firm Misys, will serve as chairman, president and CEO of DXC. Prior to Misys, Lawrie had also been CEO of customer relationship management pioneer Siebel Systems before it was acquired by software giant Oracle. He began his career at IBM, where he spent 27 years.
"With the successful close of our transaction, we are standing up a company that is ideally suited to meeting the needs of a rapidly changing technology marketplace," said Lawrie, who promised that the new company would deliver "greater value for clients, partners and shareholders, along with growth opportunities for our people".
In a presentation to investors and analysts last week, Lawrie revealed that the company had set targets of a first-year revenues of between $24bn and $24.5bn, with modest annual growth targets of between one per cent and four per cent.
He added that the IT services industry is "fundamentally changing", with services increasingly requiring scale to maximise profitability as pricing continues to be pinched by cloud computing and the decline in the kind of major, multi-year projects that CSC and HPE Enterprise Services used to thrive on.
The greater part of the HPE Enterprise Services side of DXC is the old EDS services business, which Hewlett-Packard overpaid $13.9bn for back in 2008, just as the global financial crisis was kicking off. The kind of major-project enterprise services that EDS specialises in hasn't fully recovered since then.
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