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StumbleuponTax-free goal made Teradata separation challenging
Friday, July 11, 2008
DAYTON — Separating Teradata Corp. from NCR proved to be an all-consuming task that cost $25 million to $35 million but resulted in independent companies that are each doing well today, said Bruce Langos, chief operations officer for Teradata.
"I don't know if anyone has plans in this room to do a separation, especially after seeing this one, (but) there isn't enough detail you can look at," Langos told a Dayton Area Chamber of Commerce audience at the Dayton Racquet Club Friday July 11.
What made this separation difficult was the desire to keep it a "tax-free" transaction, meaning the companies had to clear certain legal hurdles and do things in a particular way, Langos said. As the two companies moved apart, employees required separate facilities, and at one point in shared buildings, separate entrances, separate land lines and separate e-mail servers.
Langos said he still has IT employees in NCR's Patterson Boulevard world headquarters, but he pays to keep them there, and they remain "confidentially separated" from NCR employees.
In the end, keeping the separation tax-free meant saving shareholders some $2 billion, Langos noted.
"We were so scared of doing something that would cause or trigger that tax," he said. "I mean, $2 billion is a lot of money."
Today, NCR is refocused on self-service and point-of-sale technologies, such as ATMs and airport customer kiosks, while Miami Twp.-based Teradata is focused on data warehousing and business intelligence, Langos said.
Teradata was formally separated from NCR in October 2007 and generates about $2 billion a year in revenue, he said.
Contact this reporter at (937) 225-2390 or tgnau@DaytonDailyNews.com.
