CSC (NYSE: CSC) has reached a definitive agreement to sell its credit services unit to Equifax for $1 billion in cash, according to a company statement.
“This transaction advances CSC’s turnaround by reshaping our portfolio and enabling the company to focus on next-generation technology solutions and services, ” said Mike Lawrie, CSC president and CEO.
“Upon closing, we will receive $1 billion in cash and we intend to re-deploy these funds for share repurchases and to fund our pension plan, which will be value accretive.”
At least 80% of the proceeds—an estimated $800 million after taxes—are intended for the pension contributions and shares with each set to receive $300-$400 million,
The sale is the technology business solutions provider’s latest divestiture since it began reorganizing its service portfolio with the most recent coming six weeks ago.
The two companies are expected to finalize the agreement by December 31, 2012, after concluding regulatory reviews.
An Equifax affiliate for more than 20 years, CSC said this longstanding relationship with the credit reporting agency will ease the transition for clients and employees.
The company’s credit services unit owns credit files in 15 midwestern and central U.S. states.
