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CSC TO ACQUIRE COVANSYS FOR $34.00 PER SHARE
Acquisition Increases CSC's India Delivery Capabilities,Accelerates Development of Strategic Offshore Offerings
EL SEGUNDO, Calif. and FARMINGTON HILLS, Mich., (Apr 25, 2007)
/PRNewswire-FirstCall/ -- Computer Sciences Corporation (NYSE: CSC) and Covansys Corporation
(Nasdaq: CVNS) today announced that they have entered into an agreement under
which CSC will acquire Covansys for $34.00 per share in an all-cash
transaction. The transaction is valued at approximately $1.3 billion, and is
expected to be earnings per share neutral to CSC during the first 12 months.
The agreement was approved by the Board of Directors of CSC. The Covansys
Board of Directors, on the recommendation of a Special Committee composed
entirely of independent directors, has approved the agreement and recommends
that Covansys stockholders approve the merger. The transaction is expected to
be completed during the second quarter of CSC's fiscal year 2008.
"This acquisition furthers CSC's strategic goals of increasing shareholder
value and growing our business both organically and by acquisition," said CSC
Chairman and Chief Executive Officer Van B. Honeycutt. "With this action, we
are significantly strengthening our capabilities and presence in India as well
as creating an additional market channel for our industry, consulting and
outsourcing solutions."
"We believe this is an outstanding transaction for our shareholders,
clients and employees," said Raj Vattikuti, President and CEO of Covansys.
"CSC is at the forefront of the global IT services industry, making it an
ideal partner for Covansys. This combination meets our goal of delivering
significant value to our shareholders. It also creates exciting opportunities
for Covansys employees while increasing our capacity to penetrate new industry
verticals and deliver superior service to our existing clients. I look
forward to working with the new combined team."
"With this action, we have significantly accelerated our India offshore
business plan with the addition of a U.S. and international direct sales
force," said CSC President and Chief Operating Officer Mike Laphen. "The
CSC-Covansys combination reinforces our commitment to continuing to build a
strong offshore platform, and offers a broad range of capabilities to our
clients that can be serviced directly from India or through our existing
businesses."
Both Covansys and CSC's operations in India have been ranked among the top
10 places to work for IT professionals in India. The acquisition nearly
doubles the size of CSC's workforce in India to approximately 14,000.
The agreement requires approval by the holders of a majority of the
outstanding Covansys shares and is subject to customary conditions, including
expiration of the waiting period under the Hart-Scott-Rodino Antitrust
Improvements Act.
Advisors
Gibson, Dunn & Crutcher LLP is acting as legal advisor to CSC. UBS
Securities LLC is acting as financial advisor and has affirmed the fairness of
the transaction to the Board of Directors of CSC.
Butzel Long is acting as legal advisor to Covansys. Credit Suisse is
acting as financial advisor and delivered a fairness opinion to the special
committee of the Board of Directors of Covansys, and Katten Muchin Rosenman
LLP is acting as the special committee's legal advisor.
About Covansys
Covansys, headquartered in Farmington Hills, Mich., is an information
technology (IT) services company specializing in industry-specific solutions,
strategic outsourcing and integration services. Covansys has revenues of
$455.5 million for the 12 months ended Dec. 31, 2006 and nearly 9,000
employees worldwide. More than 70 percent of Covansys' resources are based in
India.
Covansys is known for strategic outsourcing and technology solutions in
the healthcare, financial services, retail and distribution, manufacturing,
telecommunications and high-tech industries. Founded in 1985, Covansys was
one of the first U.S.-based IT services companies to establish offshore
facilities in India, and is a pioneer in integrating offshore capabilities
into its offerings.
Covansys India has approximately 6,400 employees in locations including
Bangalore, Chennai, Vadodara and Mumbai. India operations began in 1991 and
now occupy 550,000 square feet, aggregating one of the largest offshore
facilities among U.S.-based consulting and technology services firms.
About CSC
Computer Sciences Corporation is one of the world's leading information IT
services companies. CSC's mission is to provide customers in industry and
government with solutions crafted to meet their specific challenges and enable
them to profit from the advanced use of technology.
With approximately 77,000 employees, CSC provides innovative solutions for
customers around the world by applying leading technologies and CSC's own
advanced capabilities. These include systems design and integration; IT and
business process outsourcing; applications software development; Web and
application hosting; and management consulting. Headquartered in El Segundo,
Calif., CSC reported revenue of $14.7 billion for the 12 months ended Dec. 29,
2006. For more information, visit the company's Web site at www.csc.com.
SOURCE Computer Sciences Corporation; Covansys Corporation
CONTACT:
Investors
James Trouba,
(248) 848-8896,
jtrouba@covansys.com,
Media
Dorothy Chisholm,
(248) 848-2283,
dchisholm@covansys.com
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