HP to Focus on Software and Server Systems with CSC Merger

In the competitive world of IT Services, Hewlett-Packard has set themselves as a big player, just like CSC. Despite this, the two have started down a road that could make them even bigger. The two companies have agreed to merge together in a deal worth a whopping $8.5 billion.

The remaining segments of HPE will be focusing on server systems, networking, software and storage hardware, Yahoo! has noted. For HPE, the decision may be double edged, as analysts have shared that traditional data centers are giving room for cloud computing and the company will therefore benefit from the merger.

However, there are already strong players in this sub-industry. Case in point, Microsoft and Amazon are the current big players in cloud computing.

Customers should expect to receive world-class offerings in cloud, application development and modernization, mobility, IT services and business process services. It would seem, that the customer is truly at the heart of the emerging company.

Meg Whitman, HPE's CEO, even said that "HPE and this new company will be closely connected moving forward with agreements that will keep the two companies aligned for current customers and grow new business opportunities over time."

It was a unanimous decision made by the CSC board to merge with the Enterprise Services segment of the Hewlett Packard Enterprise (HPE), Database Trends and Applications reported. The deal should be finished by March 2017, and will leave CSC and HPE shareholders owning 50% of the new entity's shares.

This piece of news is coming just 6 months after CSC announced dividing the company into CSC and CSRA - the first of which is meant to service commercial and government clients globally and the second which will serve the public sector. Nevertheless, CSC's executives believe that this merger will make for one of the world's largest pure-play IT services companies. If the estimated annual revenue of $26 billion is anything to go by, there is hardly any room for doubt about the size and control the company will have.