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Computer Sciences Corp is to step in and take control of Isoft’s key software for the National Health Service’s IT programme in a way that will still allow IBA’s takeover of the troubled software house to go ahead, Richard Granger, director-general of the NHS programme indicated Thursday.
The US consultancy, which has been charged with implementing part of the £12.4bn project, will provide finance and management expertise to ringfence the NHS’s interest in Isoft’s Lorenzo care patient record, a key part of the programme.
An announcement is expected “in the next few days”, Mr Granger said.
Giving evidence to the Commons health select committee’s inquiry into the issues surrounding the NHS programme, Mr Granger said that “[CSC] is in the latter stages of ensuring appropriate finance and management control to take the largely completed code and to test it and get it into readiness for production”. That would allow the Australian-owned IBA’s £140m bid for struggling Isoft to go ahead, which Mr Granger said he understood “to be near a satisfactory conclusion”.
CSC, which has step-in rights over the cash-strapped Isoft, originally indicated that it would block the deal. The agreement would secure the financial future of the UK healthcare software group.
Mr Granger was forced to intervene in the row last week when he told Isoft and CSC to sort out their differences.
Thursday he hoped the three companies would be making an announcement “in the next few days” on progress.
Isoft and IBA posted their scheme of arrangement to approve the recommended all-share offer late on Wednesday evening.
An extraordinary meeting of shareholders is scheduled for July 4 for them to approve the transaction.
John Weston, Isoft’s acting chief executive, said discussions were constructive and there was “a reasonable likelihood” that CSC would consent to the change of control of Isoft.
However, Mr Granger warned that should the deal fail, “we have third party resources now in Chennai [Isoft’s Indian development base]” to take control of the NHS element of Isoft’s work and ensure its delivery.
That, Mr Granger added, “will force CSC to step up to the plate of ensuring proper finance and management control of the Isoft product for the NHS”.
Mr Granger is understood to have on standby Martek, the company that played a key part in the successful introduction of London’s congestion charge, the project Mr Granger ran before he was asked to oversee the NHS programme.
Shares in Isoft closed up ½p at 43¼p.