Computer Sciences Corp. has decided to “explore strategic alternatives” including a potential sale. The company issued an announcement, acknowledging that its action is in response to "expressions of interest" it has received.
In making the announcement, which seems to confirm widespread rumors, company officials cautioned that there can be "no assurance the exploration of strategic alternatives will result in a transaction." Furthermore, the company does not plan to disclose any developments regarding the exploration until and unless there is a specific offer that CSC's board of directors approves.
Speculation on the possible sale of CSC has been rampant since November, with Lockheed Martin, Hewlett-Packard and IBM said to be among the suitors. CSC ranks among the largest information technology services players at $14 billion in annual revenue. Government is the company’s largest market segment, accounting for a third of its annual revenue.
CSC has retained Goldman Sachs to advise the company as it evaluates alternatives.
In addition to exploring a potential sale, CSC has launched a restructuring program that will eliminate 5,000 jobs. The company said it aims to reduce its workforce by 4,300 employees during fiscal 2007, which began April 1, 2006. About 700 positions will be cut in fiscal 2008.
Company officials said most of the cuts will occur in Europe, where CSC has more people than it needs.
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