Anthrax Precautions Delayed Word of Exult Stock Sale
Norstan Moves From Brea to Irvine; IMC Networks Fills in Map with East Coast Office
TECHNOLOGY
by Andrew Simons
The U.S. Postal Service seems to have added to some tense times at Exult Inc.
Because the post office has delayed mail to government agencies since the anthrax attacks, the notice to the Securities and Exchange Commission that Banc of America Securities intended to dump 1.3 million Exult shares didn’t arrive until three weeks after the sale.
The notice finally posted a day after Exult said its $22 million loss from the year-ago quarter had narrowed to $4.5 million and sales had increased 179% to $89.4 million.
A sour note from US Bancorp Piper Jaffray didn’t help the stock as the Irvine-based company’s shares declined 50% in a non sequitur from the earnings report. Confounding things more, the company just unveiled a $700 million deal with Prudential Financial Inc. to manage its human re-source operations.
While most executives decline to comment about changes in their company’s stock price, Exult officials couldn’t ignore this one. After Exult chief Jim Madden received calls from major shareholders about the dip in Exult shares, he sprung to action.
“I was shocked at how the stock was hit,” Madden said. “It was almost humorous because we had just reported good quarterly results.”
Making matters worse: Exult has a major deal with Bank of America Corp.,Banc of America Securities’ parent,to handle its human resources functions. To an outsider, it seemed as though Bank of America could have known about some issues with Exult’s service and software and dumped its shares.
Bank of America was quick to dispel such thinking.
“We are very pleased with Exult’s service and remain fully committed to this innovative relationship,” said Mary Lou Cagle, Bank of America’s human resources vice president. “Their performance under our contract has been excellent.”
Noteworthy: On Dec. 5, the day Bank of America sold its shares, the stock’s price scarcely blipped. It wasn’t until people heard of the sale a month later that the stock fell. Since then Exult’s stock has rebounded, advancing 10% from what would amount to a yearlong low.
Norstan Moving to Irvine
Minneapolis-based Norstan Inc., an integrator of telecommunications systems for corporate call centers, has moved its local digs to Irvine,a move the company hopes will give it better access to its Orange County customers.
“A fundamental part of offering superior service is being where your customers need you to be,” said Jim Granger, Norstan chief executive. “Our new location in Irvine affirms our commitment to the Southern California marketplace and our strategy to expand Norstan’s reach by strengthening our presence in existing markets and developing new ones.”
The company’s Irvine site is set to feature advanced equipment and a larger area for Norstan’s customer service area.
IMC Opens East Coast Office
IMC Networks Corp. may have skipped the East Coast on its way to Europe, but the Foothill Ranch company says it plans to establish an East Coast presence. The maker of networking gear for local- and wide-area networks has opened an office in Clearwater, Fla., to serve the East Coast, Caribbean and Latin America. The company already has a European office in Belgium.
“This new office will allow the company to further support its existing reseller and distribution partners in Latin America, the Caribbean and the East Coast,” said company spokeswoman Lynda Orban.
IMC hawks its wares in more than 50 countries. Chairman Jerry Roby used to be a code breaker for the National Security Agency. The company’s name originally was “It’s My Company Networks”,a nod to the easy installation features of the company’s products.
First American Takes Stake
Santa Ana’s First American Corp. was impressed enough with the work Irvine Technology Corp. did for it, it bought a third of the company. Irvine Technology, a software development and services company, had been working on some products designed for First American’s title business.
“Irvine Technology has been instrumental in the successful development of our title company’s core technology. They’ve done an outstanding job,” said John Hollenbeck, First American executive vice president overseeing technology. “Through this ownership interest in Irvine Technology, we are further strengthening our ability to develop applications that meet the needs of both First American and our clients.”
During the past few years, Santa Ana-based Irvine Technology has worked with First American to develop its FAST Transaction System, a browser-based production system currently being used to automate and centralize the production of title and escrow settlement products and services.
