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Computer Sciences increases CSA stake

Boosting its Asia-Pacific clout, Computer Sciences acquires a 51-percent stake in CSA Holdings, one of Asia's largest IT services companies.

Boosting its Asia-Pacific clout, Computer Sciences today said it has acquired a 51-percent stake in CSA Holdings, one of Asia's largest IT services companies.

Prior to today's announcement, the El Segundo, California-based services and consulting company already owned 40.84 million shares, or about 31.6 percent, of Singapore-based CSA.

Last month, CSC made a public offer to buy more CSA Holdings' shares at 62 cents per share. Today, CSC said it had purchased another 20.62 million shares, or the 16.7 percent needed to give the firm a 51-percent controlling interest in CSA.

The company has an outstanding tender offer to buy the remaining 49 percent of CSA's shares by March 5, a source close to the company said.

CSA has approximately $270 million in annual revenue, 2,000 employees, and 128 million shares outstanding.

"This acquisition is an important step in building a major presence for CSC in Asia over the next several years," Van B. Honeycutt, CSC's chairman, president, and chief executive officer, said in a statement. "We are extremely pleased to have CSA, its management, and its staff of professionals join CSC."

Partnering with CSA will help CSC service its larger clients DuPont and J.P. Morgan in Asia, CSC said.

The market for computer services in Asia-Pacific, excluding Japan, is expected to reach $16.6 billion by 2002, according to International Data Corporation. The market grew 2 percent to $9.6 billion in 1998.

Besides Singapore, CSA does the majority of its business in Hong Kong, Indonesia, Malaysia, China, the Philippines ,and Taiwan, and works closely with IT companies in Japan and other areas of Asia.

In related news, Prudential Securities raised its rating today on Computer Sciences to "accumulate" from "hold."