The proposed sale of its 1,500-employee, San Jose-based Tymnet business to British Telecommunications Plc for $355m (CI No 1,231) is only the first stage in a major reorganisation and downsizing of McDonnell Douglas Corp’s $1,200m-a-year information business, and the next major step was announced yesterday when the company revealed details of its plans to float its computer systems business on the London Stock Exchange. The business, structured around the former Microdata Pick systems business, has annual sales of about $400m, but is much more successful here in the UK than it is in the US; it will however include the US business. The new company, which will retain the McDonnell Douglas name – McDonnell Douglas Information Systems International Plc, presumably – plans to float a proportion of its shares early next year, but has not retained an investment banker or broker yet; McDonnell will retain an unspecified minority stake. All manufacturing for the world market will be done at the Hemel Hempstead, UK base, and the new company – under managing director Jeremy Causley – projects turnover of $455m UKP275m, which will make it the second-biggest British computer manufacturer after ICL. It will not retain the North American field service business: instead, McDonnell has retained The Lodestar Group to assist in the sale of the third party maintenance operations. The one major business that is being retained is the St Louis-based computer-aided design, solids modelling and manufacturing Systems Integration business, which does about $300m a year. The new UK-based company will market the Systems Integration products outside North America, as the exclusive distributor. Job cuts are seen at the old Microdata base in Irvine, and in St Louis, but where possible McDonnell will offer displaced personnel other positions.
