Comdisco Accelerates Strategic Focus On High-Growth Businesses.ROSEMONT, Ill.--(BUSINESS WIRE)--March 24, 1999-- Divestiture The breakup of AT&T. By federal court order, AT&T divested itself on January 1, 1984 of its 23 operating companies, which became known as the Regional Bell Operating Companies (RBOCs). of Low-Margin Businesses and $150 Million Pre-tax Charge Enables Company to Expand Global Service Businesses Comdisco, Inc. (NYSE NYSE See: New York Stock Exchange :CDO (Collaborative Data Objects) A programming interface from Microsoft for accessing MAPI-based e-mail, calendaring and scheduling servers. Originally called "OLE Messaging" and "Active Messaging," CDO wraps the Enhanced MAPI library into a COM object that provides the ), a leading technology services company, today announced a major shift in corporate strategy designed to accelerate its growth as a global provider of technology infrastructure solutions. To address increasing market demand for technology services, the company is moving to focus on high-margin service businesses and shed low-margin businesses, including its mainframe leasing portfolio and vendor lease portfolio. It also plans to speed up the introduction of new service offerings in high-growth areas and increase investment in building the Comdisco brand as a leader in the information technology marketplace. "Throughout Comdisco's history, we have reinvented the company to address emerging market trends. Now, as businesses rely increasingly on their technology infrastructure to increase profits and hold down costs, Comdisco is focusing where our customers need us most: on strengthening and expanding our industry-leading global technology infrastructure services," said Nicholas K. Pontikes, president and chief executive officer. "Our fast-growing technology service businesses currently have a backlog Backlog The total value of sales orders waiting to be fulfilled. Notes: This figure is used mainly in the manufacturing industry. Increases or decreases in a company's backlog indicate the future direction of sales and earnings. of more than $1 billion in contracts. This growth area represents the future of Comdisco. By building on the strong Comdisco brand, investing in higher growth, high return initiatives, selling under-performing assets, and reducing risk in our remaining IT lease businesses, we will deliver enhanced value for our shareholders." The company also said it has completed the acquisition of Prism Communication Services, Inc., a New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of City-based provider of high-speed communications services. Comdisco had previously announced an equity investment in Prism, formerly Transwire Communications. Responding to the business demand for innovative, low-cost communications services, Comdisco and Prism are developing leading-edge managed network services for voice and data networks. Comdisco has realigned to focus on technology services, which include continuity, network, lifecycle management services, and Prism. It is also focused on its global leasing business in high-margin areas such as electronics, communications, medical, lab & scientific, and ventures businesses. In conjunction with the repositioning repositioning Laparoscopic surgery The changing of a Pt's position during a procedure to improve access or visualization of the operative field, which may be linked to complications, as it changes anatomic planes of operation. Cf Laparoscopic surgery. , Comdisco said it would record a one-time pretax pre·tax adj. Existing before tax deductions: pretax income. pretax adj [profit] → vor (Abzug der) Steuern charge of $150 million, $96 million after tax, or approximately $0.60 per diluted di·lute tr.v. di·lut·ed, di·lut·ing, di·lutes 1. To make thinner or less concentrated by adding a liquid such as water. 2. To lessen the force, strength, purity, or brilliance of, especially by admixture. share. The charge will be recorded in the second quarter ending March 31, 1999. Components of the charge include: 1. $100 million pretax associated with the company's plans to exit the mainframe residual leasing business. The company said it anticipates closing the sale of the mainframe portfolio to a third party, subject to the execution of a definitive agreement and regulatory approval, during its third fiscal quarter, ending June 30, 1999. 2. $20 million pretax associated with plans to exit the medical refurbishing business. The company is currently negotiating with a third party for the sale of the business and anticipates closing the sale in its third fiscal quarter. 3. $30 million pretax associated with the realignment re·a·lign tr.v. re·a·ligned, re·a·lign·ing, re·a·ligns 1. To put back into proper order or alignment. 2. To make new groupings of or working arrangements between. of Comdisco's service businesses, including costs associated with the relocation RELOCATION, Scotch law, contracts. To let again to renew a lease, is called a relocation. 2. When a tenant holds over after the expiration of his lease, with the consent of his landlord, this will amount to a relocation. of its network management centers and previously announced consolidation and reconfiguration of some of its continuity services facilities worldwide. "Our customers are continuing to search for help in evaluating, upgrading, and supporting their critical technology infrastructure. With these important moves, we will build on our base of existing service businesses to provide the solutions our customers want and need in the changing technology arena," said Pontikes. This statement regarding Comdisco contains forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. , which are based on current expectations and assumptions, and which involve risks and uncertainties that could cause results to differ. The company intends that such forward-looking statements be subject to the safe harbor Safe Harbor 1. A legal provision to reduce or eliminate liability as long as good faith is demonstrated. 2. A form of shark repellent implemented by a target company acquiring a business that is so poorly regulated that the target itself is less attractive. created by Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The company's proposed sale of the mainframe portfolio and medical refurbishing businesses are subject to negotiation and execution of definitive agreements as well as regulatory approvals. Although the company believes that such transactions could be effected during the third quarter, there is no assurance that such transactions will in fact be effected. Additional factors that could cause results to differ are discussed in the company's Form 10-Q Form 10-Q See 10-Q. for the quarter ended December 31, 1998. The company undertakes no obligation to publicly update or revise any forward-looking statements whether as a result of new information, further events or otherwise. About Comdisco Comdisco Inc. (NYSE:CDO), a technology services company, is one of the world's leading providers of solutions that help organizations reduce technology cost and risk. These services include desktop management; business continuity; network services; Year 2000 testing; equipment leasing Equipment Leasing is a financing option to lease equipment for a certain amount of time. Leasing Benefits
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