Earlier this month, Unisys Corporation (UIS) announced that it successfully completed its previously announced private debt exchange offers. Unisys reduced its debt outstanding by approximately $130 million (about 12%) and thereby reduced 2010 debt maturities to $65 million.
The private debt exchange offers involved the exchange of outstanding unsecured senior notes of the company for secured notes, common stock, and cash.
After the debt exchanges, the company still has approximately $300 million of notes of different maturities outstanding. UIS was struggling with a high debt level of $1061.2 million at the end of the most reported quarter.
Last month, the company reported better than expected results for the second quarter due to ongoing measures to reduce costs.
The new CEO is determined to make the organization lean and highly efficient and had underlined a restructuring plan six months back. to improve profitability. This restructuring strategy includes cutting of jobs to reduce costs, selling non-core businesses, revamping its sales strategy and focusing investments on a few higher-growth areas – outsourcing, open source and Linux products, Microsoft offerings and security.
The company hopes that it would now derive tangible results from its ongoing restructuring, after several execution missteps in the past. In particular, the high level of debt remains a cause of concern. IT spending remains weak but the company expects to benefit from government spending on security technology.
Unisys Corporation provides information technology services and solutions that offer clients with expertise in systems integration (SI), outsourcing, infrastructure, server technology and consulting.
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