HCL Infosystems will spin off 3 businesses into separate units

IT firm HCL Infosystems today said it will spin off its hardware, learning and services businesses into separate units to create a leaner structure and improve operational efficiency.

The company's board has approved transfer of hardware solutions business to wholly-owned subsidiary HCL System Integration Ltd, HCL Infosystems said in a statement.

The hardware solutions vertical includes personal computers, tablets and system integration business.

The learning business will be transferred to subsidiary HCL Learning Ltd, while the services business will go to a subsidiary called HCL Care Ltd, it added.

"Different businesses of the company are at various stages of business lifecycle maturity. Some of the new growth businesses are at stages of infancy requiring investments and capabilities acquisition, while the more mature businesses need re-tooling to be prepared for the changing business environment," HCL Infosystems said in a statement.

Reacting to the announcement, company shares jumped 4.86 per cent to close at Rs 41 apiece on the BSE.

The learning subsidiary will encompass HCL's offerings on DigiSchool, learning content, vocational training and test preparation, while the services subsidiary will focus on services business, including support services, managed services and office automation services.

"The restructuring of the businesses is with the objective of providing focused management orientation to each of the growth areas and to create a leaner organisation for the Hardware Solutions Business," it said.

The proposed restructuring will provide greater visibility on the operational and financial performance of each business and offer higher degree of independence and accountability, it said.

It will also help the company address more effectively different talent and funding needs of these different businesses, it added.

The board has also approved merger of HCL Infocom, a wholly owned subsidiary, with HCL Infosystems.

The appointed date of the aforesaid shall be January 1, 2013, the filing said.

"The telecom distribution business would continue to be with the parent HCL Infosystems, while the existing wholly owned subsidiary, Digilife Distribution and Marketing Services Limited, would continue to be engaged in distribution business of non-telecom products," it said.

The company is yet to announce the heads for these subsidiaries.


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