Amdocs to sell 81% interest in Longshine division
ST. LOUIS (AP) – Telecommunications software maker Amdocs will sell a majority stake in its Longshine unit in a shift in its Chinese market strategy.
Amdocs said the sale of an 81 percent stake in Longshine to the locally managed Longshine Technology Holdings will allow that company to focus on providing custom-built development services for telecommunications and utilities companies in China.
Amdocs, based in Chesterfield, Mo., will continue to sell its own proprietary products to Chinese service providers.
"Amdocs is committed to success in China. However, the market dynamics have not evolved in the way we had anticipated when we acquired Longshine in 2005," said Ayal Shiran, head of the Customer Business Group for Amdocs Management.
Terms of the sale were not disclosed, but Amdocs said it will incur an after-tax charge of 9 cents to 11 cents per share in its fiscal second quarter related to the sale.
"At this juncture, many Chinese telecommunications companies are still demanding locally driven, custom-built system development from companies like Longshine, while much of Amdocs' strength lies in our industry-leading CES 8 portfolio and our success in delivering our own products," Amdocs said. "We feel both models hold value for China."