Computer Sciences to Buy U.K.'s Xchanging for About $722 Millionby
Deal gives both companies larger footprint in insurance market
Shares rise above offer price; U.K. rival Capita had also bid
Computer Sciences Corp., a U.S. software and technology consultant, agreed to buy Xchanging Plc for about 480 million pounds ($722 million) in cash to expand its business in the global insurance market, topping an offer from Capita Plc.
Computer Sciences will pay 1.90 pounds a share in cash, according to a statement from the company Wednesday. The price is 8.1 percent more than Xchanging’s closing price Tuesday and above what U.K.’s Capita had offered. Xchanging’s board has agreed to Computer Sciences’ offer.
The purchase gives Falls Church, Virginia-based Computer Sciences a stronger presence in the commercial insurance market, where it already has significant resources in software, services and outsourcing. Xchanging, based in London, provides business processing technology and procurement services and its customers include large insurers, agents and brokers.
Shares of Xchanging rose 9 percent to 191.50 pence at 9:23 a.m. in London.
The deal is set to be completed in the next six months pending regulatory approval, Computer Sciences said.
Goldman Sachs Group Inc. is the financial adviser to Computer Sciences and Allen & Overy LLP is providing legal assistance.