SOME of the biggest brands in the printing sector are being tipped as suitors in a high-stake bidding war for Darwin-based managed IT services specialist CSG.
Sources are reporting that majority Japanese-owned Fuji Xerox and Canon's office division are the two main players behind bids that value the company at about $420 million.
CSG provides managed print services and operates a managed IT services division.
It already has partnerships with Fuji Xerox to expand its business throughout Australia and New Zealand.
CSG has refused to reveal the identity of the bidders since announcing to the ASX on September 29 that a mystery entity had offered to buy all the issued fully paid ordinary shares of the company for about $340m ($1.20 a share) in a non-binding, confidential proposal.
CSG confirmed on Friday that new "parties" had approached the company expressing interest in acquiring it.
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Fuji Xerox declined to confirm or deny its involvement in a potential acquisition.
"In this instance, Fuji Xerox can't speculate on the offer made on CSG," a spokesman said.
A spokeswoman for Canon did not respond to requests for comment.
A CSG spokeswoman said talks were being held under confidentiality provisions.
One financial analyst said Fuji Xerox was a sensible candidate to lodge a bid but questioned whether it would want control of CSG's pure IT division.
Facing declines in its hardware business and the threat to traditional printing posed by tablet computers, Fuji Xerox has been spending billions of yen over the past four years reinventing its company as a managed print services provider.
And it has been working with Fuji Xerox in the region.
CSG, which has about 1500 employees in Australia and New Zealand, delivered a net profit after tax of $39m on revenue of $388.6m last financial year.
According to industry observers, the company's balance sheet looked healthy
CSG's decision to make public the approaches has been viewed by some in the industry as an attempt to place a "for sale" sign on the company. One source said that signal could indicate it was struggling to keep heavy working capital requirements from weighing down its margins.
http://www.theaustralian.com.a...frgakx-1226163377845
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