When Clive Higgins, UK group managing director of Norsk Data A/S, refers to himself as a Norwegian civil servant his tongue is planted in his cheek. However the description is true, if slightly disingenuous. Back in April, Norsk Data was bailed out by the state-owned Den Norske Bank, which now owns around 80% of the firm with the rest held by Fokus Bank. Today Norsk Data is a two-man holding company, with the guts of the business transferred to a new company, Nordic Data A/S which controls the UK, Scandinavian and Irish operations. Since the bail-out and rescue, which left shareholders with nothing, the company has gone quiet – Higgins says that he wanted to affect a turn-around in the UK business before telling the world about it, but now it is about to embark on a substantial bank-backed acquisition programme of small sized companies. With the banks having effectively written off its debt, and the transition from mini-manufacture to services company complete, Nordic generated UKP77m in turnover during 1992 and UKP9.6m profits. The UK alone brought in revenues of UKP18m and increased staff numbers by 30% to 320. Its activities are split into three separate divisions: ND ServiceTeam makes up about 80% of total sales and provides a whole range of computer services, including maintenance, systems integration and disaster recovery. ND Applications, described by Higgins as the best of the past, contributes about 15% of total turnover. The division’s main customers are at departmental level of local government for which it develops specialised Unix software for the environmental health and planning departments. The smallest division is ND Repair Centre Services, a UKP2.2m business that undertakes general repair work for both ServiceTeam customers and third parties which in clude Seagate and Fujitsu hard disk operations.
Possible re-flotation
The changing of the company has also changed its customer base: the vast majority of customers are the product of the last three years in the UK, Higgins says. In Norway the company’s base has proved much more stable, largely because it is a much smaller market. Norsk’s relationship with the banks sounds cozy enough – the institutions are looking for a long-term return on their investment with the possible re-flotation of Nordic around five years away. In the meantime it has given Higgins, if not carte blanche, then a degree of leeway in his spending plans. He is looking to buy small companies with UKP1m to UKP5m turnover, to bolster the ServiceTeam and Applications divisions. Not to strengthen any particular area of technology, he says, but simply as a way to expand his customer base. As we went to press, the ink was just dry on one such deal, with a new, but so far unnamed partner. The other area that interests him is the networking and communications side; Higgins expounds Norsk’s existing expertise in local network support and network management and says to expect a contract announcement very soon that will see the company expand into the voice side, procuring and installing a pan-European network. One customer that the company can talk about is the UK Meteorological Office, which will be paying Nordic UKP2m over three years to maintain its hardware and networks. Nordic’s own hardware legacy has virtually gone. Three years ago its hardware research and development arm was spun off as Dolphin Server Technologies A/S. Nordic has no representation on the Dolphin board, says Higgins, and its only equity stake in the server business consists of the building that was given to Dolphin at the break-up. As for how much is available to spend on new businesses, Higgins explains that though the net balance sheet sits at roughly UKP25m, this is not a very useful measure of spending power. The banks, it appears, have decided that to make Norsk successful in the long term, the firm must spend in the short.
