Logica

» see logica.com as it lived, on the wayback machine

~ the eulogy ~

Logica started in 1969 when five people left Scicon, an American computer firm whose London operation had recently passed to BP. Len Taylor took the operational side and Philip Hughes took the visionary one; the other three founders were Pat Coen, Steve Feldman and John McNeil, with David Mann joining a few weeks later. The first real contract came in 1970, a nationwide computerized hotel reservation system worth £100,000, and the control system for the United Kingdom's natural gas grid followed in 1971. The premise was that a British systems house had no reason to stay British, so the first overseas office opened in the Netherlands in 1973, the year turnover crossed £1 million.

The float came on 26 October 1983, with about a thousand employees holding roughly 40 percent of the company between them. The share price then sat flat until well into the 1990s. Martin Read, recruited out of GEC Marconi, is the one who moved it, with average annual earnings growth of 35 percent over the five years to the end of the decade. Market value went from £130 million in August 1993 to £6.1 billion in December 1999, which bought a place in the FTSE 100, and by then 8,500 people were working there on contracts for Ford, Exxon, Vodafone, Reuters and Deutsche Bank.

The merger that changed its name came on 30 December 2002: Logica at 60 percent and the British consultancy CMG at 40 percent, trading afterward as LogicaCMG. Then came a buying spree across continental Europe, Unilog of France at £631 million and WM-data of Sweden at £876 million in the same year of 2006, which by 2007 meant 39,000 employees in 36 countries and more staff in France and the Netherlands than in Britain. A profit warning that year turned shareholders against the strategy and Read was forced out; Andy Green arrived as chief executive on 1 January 2008, and on 27 February the company dropped CMG from its name. Then the European debt crisis arrived at a business whose customers were European governments and European banks, 1,300 jobs went in December 2011, and the shares were worth half what they had been a year earlier.

~ the dossier ~

~ the systems you used without knowing ~

In 1972 and 1973 Logica won the design of SWIFT, the messaging network that international banks still move money over. In 1974 it formed Sesa-Logica with the French firm SESA to build Euronet, a packet-switched research network running X.25 virtual circuits. It wrote the original automatic train control for San Francisco's Bay Area Rapid Transit.

Then the British institutional work. CHAPS, the automated clearing system for the UK banks, in 1984. The Customer Service System for British Telecommunications, a £1 billion implementation that was then the largest computer project attempted in Europe. London Underground's automated ticketing in 1987, and a new version of the machine that generates Premium Bond numbers in 1988. In December 2003 Logica's software was flying Beagle 2 after separation from Mars Express, which is the mission everybody remembers, on account of it going quiet on landing.

The piece of Logica that touched the most people was a product division it sold. LogicaCMG Telecom Products built message center software for mobile operators, the thing that takes a text message in and gets it to a handset, and it went to Atlantic Bridge Ventures and Access Industries on 20 February 2007 for £265 million, becoming Acision. For anyone who spent the 2000s in a country where texting was the default form of contact, as Turkey was, the vendor behind the message center never came up as a question. You bought credit and you typed, and it arrived. I can only name the company because it turns up in the paperwork for its own sale.

~ the perot bid of 1985 ~

In 1985 Electronic Data Systems, run by Ross Perot, came for Logica with a hostile takeover bid, and Logica fought it off. Around the same time the UK trade magazine Computing named it Company of the Decade. The two facts belong together: being the last large independent British computer services firm made it a trophy and a target at once, when almost every other British house of that generation had already gone to a bigger buyer.

Independence came with a cost that showed up later. David Mann became managing director and CEO in 1987, and turnover went flat for the rest of that decade and into the next, with an outright loss in 1991 as the financial services customers pulled back in the recession. The reputation it had earned was for technically difficult bespoke work that did not always return much to the customer or the shareholder, which is the particular trap waiting for a firm that hires on technical pride. Mann was out by February 1994 and five executive directors left within two years of Read's appointment. Hughes resigned as chairman in 1990, left the board in 1995 and became a successful landscape painter, while McNeil had gone in 1977 and ended up writing novels and BBC drama.

~ 105 pence ~

CGI of Montreal agreed to buy Logica on 31 May 2012 for £1.7 billion in cash, 105 pence a share, plus about $499 million of assumed net debt. Shareholders approved it on 16 July with 99.54 percent in favor and the deal closed on 20 August 2012, making CGI the sixth largest IT services provider in the world at roughly 72,000 staff. The integration finished in March 2013 and the brand went with it; logica.com now redirects to cgi.com. What survived under its own name is the alumni society that former staff still run, for people who call themselves LogiBods.

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