Private equity firms Apollo Global and Kyndryl Holdings are in talks to make a joint bid for IT services company DXC Technology, sources close to the matter have revealed. The companies are considering an acquisition offer between $22 and $25 per share for DXC, which saw its shares rise 11% to $18.45 in New York trading on Monday, valuing the company at around $3.3 billion.
DXC, which provides IT services such as analytics, engineering, cybersecurity, cloud infrastructure, and outsourcing, has been exploring a potential sale of its insurance software business for more than $2 billion. However, it is also considering remaining an independent company under new CEO Raul Fernandez. The sources noted that DXC and Apollo have declined to comment on the matter while no immediate response was received from Kyndryl.
The economic downturn has affected DXC’s revenue, leading to a decrease in corporate spending and causing its shares to drop by over a third in the past year. To address the slowdown, DXC has implemented cost-cutting measures and restructuring initiatives.
Kyndryl, known for its infrastructure IT services, has a market value of $6 billion. Apollo Global Management is one of the largest private equity firms in the world with over $671 billion under management. Discussions are ongoing and further details are expected to be released soon.
