September 8, 1997

Wang Eyes Olivetti's Servic es Arm By Marianne Kolbasuk McGee ang Laboratories Inc. is reportedly in talks to buy a large chunk of Olivetti SpA's IT services business, a move that would cement Wang's five-year turnaround from minicomputer maker to global service provider. The deal, valued at up to $900 million, would give Wang a major European supplier of desktop-management, network-management, and maintenance services. IT services have been Wang's main focus since it sold the last of its major product businesses-document-imaging software-to Eastman Kodak earlier this year. Olivetti's Olsy IT service business would be Wang's first acquisition outside the United States. Wang CEO Joe Tucci wouldn't comment on whether the company will buy the Olivetti business, but he did say Wang's next set of acquisitions will be international companies. "The customers that we are going after are multiregional," Tucci says. Wang has been on an acquisition tear since emerging from Chapter 11 bankruptcy protection in 1993. Among its major deals: last year's $167 million purchase of I-Net Inc., a Bethesda, Md., network integrator; and its $160 million acquisition in late 1994 of the U.S. IT services operations of France's Groupe Bull. Although those moves have helped Wang expand beyond maintenance services, a legacy of Wang's minicomputer base, analysts are still waiting for those acquisitions to pay off big. "Wang still needs to win a few high-profile trophy accounts," says Ellen Carney, an analyst with consulting firm Dataquest Inc. in San Jose, Calif. Tucci points to an undisclosed multimillion-dollar contract Wang recently landed to provide desktop and networking outsourcing for a large multinational pharmaceutical company. Many customers, he says, don't like t alking about such arrangements. Wang, which was profitable and posted revenue of $1.3 billion in its fiscal year ended June 30, has $240 million in cash that can help finance additional acquisitions, notes Tom Willmott, an analyst at the Aberdeen Group in Boston. Some 38% of Wang's revenue was generated outside the United States. Back to News in Review Send Us Your Feedback Top of the Page

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