IT services giant Computer Sciences Corporation (CSC) announced Monday that it is selling its credit services business to Equifax for $1 billion in cash. The unit, which is the largest independent credit reporting agency in the US, contributes more than $200 million to CSC’s sales. The company plans to use the proceeds for its pension plan and a share repurchase program, among other initiatives. In October it agreed to sell its Italian technology consulting and systems integration operations to Italian IT firm Dedagroup.
These moves are part of a larger strategy by CSC to refocus its portfolio on specialized software and technology services, including cloud computing, cybersecurity, analytics, and health information systems. In addition, it is focused on cutting costs and better managing underperforming contracts. The company has seen falling or stagnant revenue over the last several years, and in fiscal 2012 (ended March) it recorded a net loss of more than $4 billion because of write-offs and a goodwill impairment charge.
There are signs the turnaround is working as CSC reported better than expected results for Q2 2013, including improved operating margins across all segments. The company also raised its earnings per share target for 2013. The market has been reacting favorably as well, with CSC shares hovering near $40, up from the low to mid-$20s over much of the summer.