Apollo and Kyndryl Interested in Acquiring DXC Technology, According to M&A News

DXC Technology has been facing challenges in terms of sales growth due to macroeconomic headwinds impacting IT spending. Over the past two fiscal years, the company’s revenue has declined, and it expects a 4-6% organic revenue decrease for Fiscal 2025. In response to these challenges, DXC is focusing on cost reduction, restructuring, and considering the sale of its insurance software division for over $2 billion.

Apollo Global Management and Kyndryl Holdings are reportedly in advanced talks to jointly bid for DXC Technology. The potential bid could value DXC between $22 and $25 per share, a significant premium over its closing price of $16.55. If successful, this would be a significant acquisition for both companies.

DXC Technology saw its shares surge by 11.48% on June 10 after the news broke, and the stock gained an additional 4.34% in after-hours trading. The company currently has a market cap of $3.3 billion and has been struggling with revenue growth issues over the past few years. Despite these challenges, DXC may choose to remain independent and continue its cost-cutting efforts while aiming for growth in the future. However, Wall Street analysts are cautious about the stock, with a Hold consensus rating and a price target of $18.28, implying a 0.92% downside potential from current levels

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