RealTime IT News

Comdisco to Sell 2 Leasing Units to GE Capital

Computer services provider Comdisco Inc. , which found its technology services business in the middle of a bidding war between two tech firms, moved to rid itself of two more businesses Monday when it agreed to sell its Electronics and Laboratory & Scientific leasing businesses to General Electric Co. for about $655 million.

Specifically, Rosemont, Ill.'s Comdisco wants to sell the units to GE Capital's Commercial Equipment Financing unit for the aforementioned price, with future contingent payments based on portfolio performance criteria. The agreement is subject to approval by the U.S. Bankruptcy Court for the Northern District of Illinois at a January 24 hearing.

Comdisco further noted that it is currently evaluating its remaining leasing businesses, Information Technology (IT), Telecommunications and Healthcare, by Jan. 31. Comdisco said these units received bids during an auction that ended in December 2001.

"The board concluded that the consideration offered for the Electronics and Laboratory & Scientific assets represents the highest value we could expect to receive and we are confident that these businesses and their customers will benefit from the unparalleled reputation and tremendous resources of GE Capital Commercial Equipment Financing," said Norm Blake, Comdisco's chairman and chief executive officer, in a public statement.

Comdisco filed for Chapter 11 bankruptcy protection on July 16, paving the way for the struggling outfit to sell some of its businesses while it worked to resolve liquidity issues. Concurrent with the bankruptcy filing, Comdisco agreed to sell its Availability Solutions division to Hewlett-Packard Co. for $610 million.

But that bid was bested in October by SunGard Data Systems Inc., which offered $825 million. HP fired back, was rebuffed by the U.S. Bankruptcy Court for the Northern District of Illinois, and SunGuard emerged the victor on Nov. 15.

That such a fierce battle between two tech firms over this division, a top-notch business continuity concern, should come as no surprise; in the wake of the catastrophic events of 9-11, more and more firms are looking to shore up back-up operations plans

Comdisco, meanwhile, has targeted emergence from Chapter 11 during the first half of 2002.