Bull splits to tackle poor sales

Bull is to split its server and services businesses into two separate subsidiaries as part of a far-ranging reorganisation.

This will see 1,800 people - 10 per cent of the workforce - losing their jobs over the next 18 months as the company continues to grapple with disappointing sales.

Sales for the second half of this year are expected to fall well below expectations, which Bull blames on continuing weakness of the European server market, particularly in France, where the company is headquartered.

A company spokesperson said results for its services business, which provides consulting and systems integration as well as outsourcing services, are also likely to be "bad".

The reorganisation amounts to an acceleration of Bull's previous announced strategy to restructure itself into four autonomous divisions - services, servers, smart cards and software - with a focus on services and servers.

Earlier this year, Bull announced plans to spin off its security and network management software businesses, BullSoft, into a worldwide subsidiary called Evidian.

As part of the reorganisation Bull will seek partnerships to divest itself of non-strategic activities in order to raise 400 million euros next year, but its spokeswoman said it has not been decided what these are yet.

The firm also said it is searching for "specialist partners" in order to develop its server business, which accounts for around 30 per cent of revenues, and involves OEM deals with IBM selling AIX-based Unix servers and Microsoft for the sale of Windows Datacenter servers. ®