Restructuring could lead to a takeover

Article Excerpt

UNISYS CORP. $6.85 (New York symbol UIS; WSSF Rating: Average) plans to sell non-core assets, expand its computer outsourcing operations and cut costs. These moves will cost $300 million, but could cut its annual expenses by $250 million. The plan is showing signs of progress. In the fourth quarter of 2005, Unisys cut its losses to $0.09 a share (total $31.1 million) from $0.10 a share ($34.9 million) a year earlier. The company’s operating profit margin, excluding pension expenses, improved to 2.3%, compared with a loss of 5.2% in the year-earlier quarter. Unisys aims to raise this to at least 8% by 2008. The company also plans to drop its stockholder rights plan when it expires in March this year. These plans make hostile takeover offers more difficult, so lifting it could turn Unisys into an acquisition target. Unisys is a hold. hold…

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