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July 18, 1990

BUYOUT TEAM AT EUROSERVE COMPUTING, FORMER RTZ BUREAU, MOVES QUICKLY TO DIVERSIFY

By CBR Staff Writer

Euroserve Computing Ltd, formed in a management buyout from RTZ Corp Plc in November 1989, is attempting to diversify into activities other than the bureau-based operations that have formed the backbone of its business over the past 20 years. Set up in 1966 as a computing centre for the RTZ oil and mineral conglomerate, the Bristol-based operation was established as an independent company via a UKP50,000 buyout last November. Bell Atlantic originally intended to acquire the division, but when that deal collapsed, two Bell Atlantic directors joined the buyout team. The Euroserve directors are now spreading their wings and offering a range of services that include facilities management, software training, and consultancy. They are also planning for DEC and IBM disaster recovery services by the late summer, and are currently examining three possible sites in the Bristol area. RTZ still constitutes 20% of the company’s UKP1.8m turnover, and Euroserve acknowledges that figure should be reduced to around 5%. The majority of revenue – UKP1.4m – is still derived from bureau activities on an IBM water-cooled 3083 and air-cooled 4381, providing a total storage of 30Gb. Euroserve also has three DEC MicroVAXs and two PDP-11s which are being replaced by a VAX 6000. The IBM equipment is used for standard data processing, and information retrieval is done on the DEC machinery. In addition to selling machine time, software, and services, Euroserve provides that staple of the bureau world, payroll administration. Again, that is derived from its 20 years within RTZ, but the company has over 50 bureau clients, including the Bass Group and Runcorn. A more recent addition to the bureau’s portfolio is laser printing on a Rank Xerox 4090 laser station. An average print run will be around the 50,000 mark, and the company says that it is ideal for rights issues and dividends. Euroserve is tar-geting facilities management as an area of growth, and says that the current contribution of UKP126,000 is likely to increase sharply over the next 12 months. To date, Euroserve has two customers, one of which is RTZ. The company says that it isn’t targeting large users, but looking for medium-sized operations that need more space or time to develop new applications. Euroserve will either assume total responsibility for a client’s operations and staff, or take over specific applications, and both could be done from Bristol or in-house.

Disaster recovery

Despite having no IBM mid-range equipment, Euroserve believes that it has the necessary consultancy skills to handle an AS/400 or System 36 installation, and it is currently involved in converting a mainframe application to the RS/6000. Delays at the IBM end have necessitated an extension to that contract, although Euroserve says the client has received written notification that the new machine will be delivered by July 26. Disaster recovery is also planned to take off in the near future. The company intends to start with DEC recovery, specifically MicroVAX and VAX-11/7XX machines, but will provide IBM 3083 and 4341-type facilities later inthe year. It will invest up to UKP1m in equipment, but given the cost of high-end processors, it acknowledges that it’s unlikely to kick off with a 3090. It would also consider a partnership to share costs and to provide mutual back-up. Euroserve has recently become involved in software training, and it’s especially bullish about opportunities in Eastern Europe. It has two contracts with the National Bank of Poland to train staff in IBM systems software, and the company believes that the relaxation of trading regulations with Eastern Bloc countries will lead to an increased demand for second user equipment and complementary skills. As with disaster recovery, Euroserve would consider establishing some sort of joint venture, or allying itself with a company already active in that market. As regards the rest of Europe, there is still an acute shortage of skilled staff, and that need looks set to continue in the immediate future. Euroserve says it can either re-train staff

or take in new graduates that have academic qualifications but lack hands-on experience. Training currently represents UKP36,000, but Euroserve believes it can treble that figure within a year. – Janice McGinn

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