Page 13 - Remembering ISTEL

Remembering ISTEL

Significant changes were heralded for ISTEL in 1986. The government
announced plans to sell British Leyland (which had been renamed the Rover
Group) to British Aerospace, and to spin off ISTEL as a separate company,
preferably through a management-led employee buy-out. As preparations were

made for the company's new status, ISTEL continued to grow, securing its first
£1 million order (from Horizon Holidays), and providing its first sale to the

Royal Air Force. The company's revenues jumped to £60.8 million by the end of
the year.

In June 1987 a £1.8 million share offer was made to employees and proved very
popular, being oversubscribed almost three times. Such confidence was clearly
justified, as the company's revenues rose by nearly £10 million that year over
the previous year. In 1988 the newly independent ISTEL developed separate

operating divisions for its business: ISTEL Financial Services, ISTEL
Commercial Services, and ISTEL Motor Industry Services. Other achievements

for the year included the establishment of ISTEL Visual Interactive Systems;
several acquisitions (of Viewtel, Abbey Business Consultants, Mycrom, and
Deritend Computers); and the opening of an office in Edinburgh.

Believing that ISTEL would be better positioned for growth if it operated under
the aegis of a larger, like-minded firm, ISTEL's board of directors searched for
months for a suitable parent company. Finally, in October 1989, a deal was

struck with AT&T, and the renamed AT&T ISTEL began a new era.

The alliance quickly proved advantageous to ISTEL, allowing it access to many

new opportunities within AT&T's large, international client pool. Even as
economic recession worsened, ISTEL continued to grow, opening two new

business units in the United Kingdom: AT&T ISTEL Global Messaging Services
Limited and AT&T ISTEL Computer Services Limited. By the end of 1990
revenues had reached £131 million.

The following year ISTEL made its first international acquisition, of the
Dusseldorf-based Infoplan, giving the company an important foothold in
continental Europe. Meanwhile, in its domestic market, the company stepped

up its contracts with the NHS, largely in the field of facilities management, and
acquired Belmin Systems, a provider of electronic purchasing systems for local

and central government agencies.

As the 1990s progressed, ISTEL continued to expand and became increasingly
associated with the health industry. In 1994 the company outmaneuvered

intense competition to win contracts for management systems for two

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