Colt is conducting a ‘managed exit’ from the IT Services sector, in order to focus on its core businesses of Network, Voice and Data Centre Services.
The networking company’s board of directors has already approved the plan, which it plans to implement "as soon as possible." The plan would see Colt exiting over the next two or three years.
Under the new objectives, Colt would continue to honour its existing customer contracts to termination but no longer seek new business.
The exit acknowledges that the IT Services business would require investment in the short-to-medium term to be profitable, funds which Colt would prefer to invest in core infrastructure and asset based activites.
Colt claimed that this was unrelated to the recent buy-out offer by Fidelity. It expects to incur exceptional cash costs of €45 to €55 million and a non-cash impairment charge of around €90 million.
Colt CEO Rakesh Bhasin said: "The fundamentals of our core Network Services and Voice Services businesses remain solid, and we are driving improvements in our Data Centre Services business.
"We are taking decisive action to become a more focused and disciplined organisation which we believe will accelerate the performance of our core business.
"Overall, we believe the prospects for the group are good and I am confident that, with the recent changes we have made within the senior management team, we will be able to deliver improved profitability and cash returns."
