Hoskyns warns of cancelled projects

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The Independent Online
HOSKYNS, the computer software group, warned yesterday that several projects already started with clients in the financial sector would have to be cancelled following the abandonment of Taurus, the Stock Exchange's paperless settlements system.

Tony Robinson, managing director, blamed 'lack of discipline, allowing requirements to get out of control' but he declined to comment on whether Hoskyns planned to seek compensation from the exchange.

Mr Robinson was speaking as Hoskyns recommended a 469p-a- share offer from its parent, Cap Gemini Sogeti, Europe's largest computer services company. CGS, which employs more than 20,000 staff in 16 countries, bought 70 per cent of Hoskyns in 1990 at 330p a share from Plessey.

The market had expected a bid at this level because part of CGS's original offer was a promise to buy the remaining shares at 23 times 1992 earnings per share up to a maximum of 660p. Shareholders were protected by the promise of a minimum payment of 469p.

For some time it has been clear that shareholders would have to settle for that figure, as flat computer department budgets, the end of some large contracts and redundancy charges have depressed earnings at Hoskyns.

Last year earnings fell from 10.5p to 5.8p after a peak of 13p in 1990 so shareholders are being offered an exit multiple of more than 80 times. Hoskyns' shares added 6p to 464p.