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LogicaCMG texts for the last time

IT services firm LogicaCMG has sold its telecom products business to a private equity consortium for US$517million.

IT services firm LogicaCMG has sold its telecom products business to a private equity consortium for US$517million.

The consortium, headed by Atlantic Bridge Ventures, will rename the business Acision and will look to enhance its product offerings and global market leadership, focusing on converging technologies, it said this week.

LogicaCMG said the reason for the sale was that the division did not fit with its consulting and integration business.

"This separation is a logical step for our business," said Chris McDermott, chief executive of LogicaCMG Telecoms.

The firm pioneered the SMS business, helping to kick start the sector in the mid 1990s and the division is still the SMS market leader with 60% of the world's text messages being sent using its software.

However, it is gradually seeing that lead being eroded, with lower-cost rivals entering the market. Costs and margins are also falling, with messaging systems costing up to 100 times less than they did when LogicaCMG began selling them.