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Cincinnati Bell Announces Spinoff

NATION / WORLD: TELECOMMUNICATIONS

April 28, 1998|Reuters

Cincinnati Bell Inc. said it will spin off its billing and customer-management businesses into a subsidiary and reported a 3% increase in first-quarter profit of $49.2 million, or 36 cents a share. The results exceeded analysts' expectations by a penny a share as revenue jumped 18% to $508 million. The company said the operations to be spun off provided more than 80% of its revenue growth and 46% of profit growth in the period. The company said 10% to 15% of the new unit, Convergys Corp., will be made available in an initial public offering and the remainder will be distributed to Cincinnati Bell shareholders. Chief Executive John T. LaMacchia will retire when the spinoff is completed. Convergys will be one of the nation's leading providers of customer-care and billing services, with revenues of nearly $1 billion and about 30,000 employees. Shares of Cincinnati Bell gained $2.88 to close at #36.81 on the New York Stock Exchange.

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