HP acquires EDS for $13.9 billion
Date: 27-08-2008
Source: Consultant News
Hewlett Packard (HP) today announced that it has completed its acquisition of Electronic Data Systems Corporation (EDS), creating a leader in IT services.
With this acquisition, initially announced in May and valued at an enterprise value of approximately $13.9 billion, HP has one of the technology industry's broadest portfolios of products, services and end-to-end solutions. The combined offerings are focused on helping clients accelerate growth, mitigate risks and lower costs.
The acquisition is, by value, the largest in the IT services sector and the second largest in the technology industry, following HP's acquisition of Compaq, which closed in 2002. The companies' collective services businesses, as of the end of each company's 2007 fiscal year, had annual revenues of more than $38 billion and 210,000 employees, operating in more than 80 countries.
"This is a historic day for HP and EDS and for the clients we serve," said Mark Hurd, HP chairman and chief executive officer. "Independently, each company is a respected industry leader. Together, we are a global leader, with the capability to serve our clients - whatever their size, location or sector - with one of the most comprehensive and competitive portfolios in the industry."
As a business group, EDS, an HP company, will be one of the market's leading outsourcing services providers - with the ability to provide complete lifecycle capabilities in health care, government, manufacturing, financial services, energy, transportation, consumer & retail, communications, and media & entertainment. As previously announced, the group is led by Ron Rittenmeyer, president and chief executive officer, who had served as EDS' chairman, president and CEO. It remains based in Plano, Texas.
"Today marks the beginning of an exciting new era," said Rittenmeyer. "Clients will benefit from the breadth and depth of our solutions, our commitment to unsurpassed quality and our ability to provide truly global service delivery. With the resources of HP's renowned R&D and world-class technologies, we have an opportunity to truly redefine the technology services market."
HP's Technology Solutions Group (TSG) will shift to EDS its outsourcing services operations, as well as portions of its consulting and integration activities. TSG will focus on servers, storage, software and technology services, such as installing, maintaining and designing technology systems for customers, as well as certain consulting and integration services.
"Clients will benefit from the combined scale and strength of our companies as they transform their technology environments," said Ann Livermore, executive vice president, TSG, HP. "This is an important step forward in our ability to help them solve their challenges through practical innovations that deliver valuable business outcomes."
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