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Computer Sciences Buys Fruition Partners; Grows Portfolio

IT services and solutions provider, Computer Sciences Corp.CSC recently completed the acquisition of Chicago-based IT services and consulting firm, Fruition Partners. The two companies entered into a merger agreement last month. However, the financial terms of the deal were not disclosed.

Fruition Partners is the largest ServiceNow Inc. NOW -exclusive service-management consulting firm. Founded in 2003, ServiceNow is a platform-as-a-service (PaaS) provider of enterprise Service Management software.

Fruition Partners specializes in delivering technology solutions for the service-management sector. The company helps clients to integrate cloud-based service management solutions and realize cost and performance benefits quickly.

Per Computer Sciences, "[Fruition Partners] combines practical experience with technology-enabled tools and services to help organizations attain success throughout the entire Service Management process. With more than 1700 ServiceNow projects to its credit, Fruition Partners is a Master tier Solutions Partner of the leading enterprise cloud company, ServiceNow."

Therefore, the acquisition will help Computer Sciences to fill a key gap in its portfolio. The company can now offer a wider range of cloud-based service management solutions and help clients to improve business results through organizational efficiency and lower operating costs. Additionally, the move has brought in more enterprise customers.

Over the past few years, Computer Sciences has been focusing on the cloud computing market and Big Data business to cash in on the growing demand. Companies are increasingly relying on cloud-based services that make IT systems more agile and productive, and save costs considerably.

Computer Sciences has also made a few important acquisitions, for instance, the North California-based cloud infrastructure provider, Autonomic Resources, in Feb 2015. The buyout bolstered the company's cloud as well as enterprise digital solution offerings.

Furthermore, it is to be noted that the company is in the process of splitting into two separate publicly traded companies. According to the company, one will "serve commercial and government clients globally", while the other will "serve public sector clients in the United States." The new businesses will be named CSC Global Commercial and CSC US Public Sector, respectively.

Previously, the company had stated that the Fruition Partners acquisition will add value to CSC Global Commercial business. However, we believe that it is too early to determine the actual benefits of the buyout as many other consulting companies are developing ServiceNow practices.

Recently, Accenture plc ACN signed an agreement to take over Cloud Sherpas which launched a ServiceNow practice in 2013. Furthermore, companies like Cognizant CTSH and PricewaterhouseCoopers, which were previously the clients of Fruition Partners, began developing their own ServiceNow cloud practices.

Currently, Computer Sciences carries a Zacks Rank #3 (Hold).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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