[Techtaffy Newsdesk]
CSC has reached a definitive agreement with Equifax for the sale of its credit services unit for $1 billion in cash. The after-tax proceeds from the sale of the business will be approximately $750 – $800 million based on preliminary plans. CSC intends to use $300 – $400 million to repurchase shares, contribute $300 – $400 million to its pension plans and apply the remainder to general corporate purposes.
CSC’s credit services unit, which owns credit files in 15 Midwestern and Central U.S. states representing 20 percent of the U.S. population, is among the largest independent U.S. consumer credit reporting agencies, and has been an Equifax affiliate for more than 20 years.
The companies anticipate closing of the transaction by the end of the calendar year after concluding regulatory reviews.
This deal marks CSC’s second divestiture in six weeks. CSC expects that its cash deployment strategy will help to offset the absence of EPS contribution from the credit services unit in 2014 and subsequent years.
[Image: CSC Headquarters in Falls Church, Virginia / Courtesy: CSC]