EDS Sells Wireless Group

Continuing its transformation process, EDS sold off one of its wireless software
ventures for $57 million, officials said Thursday.

Syniverse Technologies, a telecommunications outfit specializing in wireless
phone service in Tampa, Fla., paid cash for EDS’ Interoperator Services
(IOS) North America to flesh out its wireless offering. IOS North America
provides business intelligence reporting and roaming, clearing and
settlement services for 3G and wireless phone carriers.

The deal is expected to close in the third quarter. Kevin Lightfoot, an EDS
spokesperson, said IOS North America’s 60 employees will retain their jobs but will instead work for Syniverse.

For Syniverse, the acquisition fleshes out its telecom services group and
gives the company the infrastructure to support its next-generation voice and data
technology.

“Through the extraordinary talent and expertise that both companies possess,
we will lead the industry toward seamless 3G services and provide
state-of-the-art interoperability solutions that resolve the complexities of
clearing and settlement across technologies and geographies,” said Syniverse
CEO Ed Evans in a statement.

EDS, on the other hand, will press on with its multi-year plan
to regain footing in the IT outsourcing industry after a series of
missteps.

“What we’re doing is focusing on our core assets and strengths,” Lightfoot
said.

In the past 16 months, EDS has sold numerous other divisions,
including its consumer network services unit, automotive retail group and
credit union industrial group. The end goal is to focus on what it thinks
its core is: providing business process and IT outsourcing as well as
application management.

This is just the latest in a string of hits EDS has taken recently.
Earlier this year, the company had to write off hundreds of millions of
dollars in contract delays with the U.S. government, specifically the $7
billion Marine Corps intranet project.

In July, Moody’s Investors Service downgraded EDS’ credit rating to
junk-bond status, stating it had a negative outlook on the company’s
future. In response, EDS issued a same-day statement rebutting Moody’s analysis.

“We have taken a series of aggressive steps to support our investment-grade
rating,” the company said in its statement. “Given our progress and sound financial footing, we are
in strong disagreement with Moody’s decision.”

More recently, the Associated Press reported an EDS system was
responsible for a computer failure that grounded American Airlines and
U.S. Airways for several hours on Aug. 1. An airline employee
entered the wrong information into a database field, causing a cascading
failure that showed every plane as full.

Despite the skid, Lightfoot said his company is a work in progress and is gaining new
contracts and renewing existing ones.

“We’re starting to see traction now in the marketplace,” he said.

News Around the Web