By Andy McCue, 6 August 2007 15:23
NEWS
BT is set to pay €60m for the IT and network services division of CS Communication & Systemes.
The loss-making Mission Critical Infrastructures division of the French company employs 1,400 people and hit €137.7m of revenue in 2006.
BT has submitted a binding offer to CS Communication & Systemes and has until 30 November to complete the deal pending consultation with representatives from both companies' works councils and merger and regulatory clearances.
Special Report: Inside India
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♦ Satyam's IT campus
♦ Hyderabad's tech parks
♦ Bringing tech to rural India
♦ High-tech on the streets of Pune
♦ Pune - the new Bangalore?
♦ Boom town Bangalore
♦ Bangalore's Electronics City
♦ SAP and Wipro in Bangalore
The acquisition would almost double BT's IT and network services revenue in France to around €400m.
But BT will need to demonstrate it can turn around the operation and build a pragmatic service offering with a mix of fixed-price projects and body-shopping services, according to Dominique Raviart, analyst at Ovum.
He said in a research note: "[Mission] Critical Infrastructures is still very much a unit that is in its early phase of recovery. Nevertheless, the €60m price looks like a very reasonable price for BT to scale up its influence in the French market."
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