SEC Report:
October 18, 1999
XPEDIOR INC (XPDR)
S-1 Filing (SEC form S1)
Xpedior provides innovative and comprehensive eBusiness solutions to Global 2000 companies and emerging Internet businesses. We combine extensive technical expertise with strategic consulting and creative services to build eBusiness solutions that enable our clients to capitalize on the communications power and transaction efficiency of the Internet. Our eBusiness solutions include one or more of the following services, customized to fit our clients' needs:
- Digital Business Strategy
- Electronic Commerce
- Digital Branding and User
Experience Design
- eBusiness Applications and Integration
- eBusiness Technology Management
- eBusiness Networks
- eBusiness Intelligence
- Enterprise Portals and Knowledge
Management
We have developed the Xpedior Solution to execute and deliver eBusiness solutions that meet our clients' needs for rapid implementation of reliable, scaleable and sustainable eBusinesses. The Xpedior Solution consists of the following key elements:
- The Xpedior Process. Our five-step methodology is designed to ensure the development of reliable, innovative eBusiness solutions for our clients;
- Our eBusiness Xpediators. Our proven collection of reusable solutions, including software architectures, components and applications, enhances the quality of the eBusiness solutions we deliver and reduces the time required to deliver such solutions;
- Our Solution Centers. Our five centralized, high-tech facilities enable our professionals to share expertise and best practices, while maintaining continuous online communication with our clients. This facilitates rapid and efficient delivery of our eBusiness solutions; and
- Our Knowledge Management Systems. Through these systems, we share institutional intellectual capital that we derive from our client engagements. Our sharing of best practices increases the effectiveness of our professionals and improves the eBusiness solutions we deliver.
We have over 1,000 employees at our 15 U.S. and three international offices. We have delivered eBusiness solutions to a broad range of clients, including major organizations such as the American Medical Association, Citibank, GTE, Hewlett-Packard, MCI WorldCom, PepsiCo, Safeway and Sears, and emerging Internet businesses such as CharitableWay, DigitalWork.com, Intershop Communications and OnlineOfficeSupplies.com. Our 50 largest clients during the year ended December 31, 1998 provided us with average annual pro forma revenues per client of $1.4 million.
OUR MARKET OPPORTUNITY
International Data Corporation estimates that the worldwide market for Internet professional services will grow from $7.8 billion in 1998 to $78.5 billion in 2003. Despite the size of this market opportunity, we believe that there are relatively few service providers that can effectively address the full range of problems and challenges associated with developing and implementing comprehensive eBusiness solutions. For example, boutique web design firms and online agencies typically focus on user interfaces and front-end design and do not have the expertise required for rapid development and deployment of high transaction volume eBusiness systems. In addition, traditional information technology services firms are focused primarily on enhancements to existing technology infrastructure and the implementation of traditional business applications, and lack the necessary focus and experience to execute innovative eBusiness solutions efficiently and quickly.
We believe businesses will increasingly seek assistance from companies that offer the comprehensive set of services necessary for them to achieve their eBusiness objectives. In our view, a comprehensive service offering must include three fundamental eBusiness disciplines -- strategic, technical and creative. To create a comprehensive eBusiness solution, our eBusiness strategists work closely with the client's senior executives to imagine and define the strategic plan for the eBusiness. After development of the eBusiness strategy, our eBusiness technology professionals build the systems and technology infrastructure required to implement the strategy. At the same time, our creative professionals work to define the interactive marketing strategy and to create compelling user interfaces for the eBusiness. Historically, Internet professional services firms have not been competent in all three of these disciplines. The Xpedior Solution incorporates all three of these disciplines, allowing our professionals to deliver comprehensive, reliable and scaleable eBusiness solutions in the demanding timeframes often required in the Internet professional services market.
OUR STRATEGY
Our goal is to become the provider of choice for Global 2000 companies and emerging Internet businesses that require comprehensive, customized, integrated eBusiness solutions. To achieve this goal, we plan to:
- extend relationships with existing clients and market to new clients;
- use our expertise in specific industries, including financial services, healthcare, high technology, media and publishing, retail and distribution, telecommunications and the eCommerce/Internet industries;
- refine, leverage and extend the Xpedior Solution by capturing our professionals' broad range of knowledge and best practices and sharing those resources throughout our organization;
- expand and leverage strategic industry alliances with leading technology companies, including Microsoft, IBM, Sun Microsystems, Hewlett-Packard and BroadVision;
- attract and retain qualified employees through aggressive recruiting, a collaborative corporate culture and competitive compensation packages; and
- build the identity and awareness of the Xpedior brand name to help promote our comprehensive range of service offerings and fulfill our corporate vision.
RELATIONSHIP WITH METAMOR
We are currently a subsidiary of Metamor Worldwide (Nasdaq: MMWW). After the completion of this offering, Metamor will own approximately 83% of our outstanding common stock, or approximately 80% if the underwriters exercise their over-allotment option in full. Metamor has announced that in 2000 it plans to distribute all of its shares of Xpedior common stock to its stockholders. Metamor expects to accomplish this distribution through one of the following:
- Split-Off. An exchange offer by Metamor in which holders of Metamor's common stock would be invited to tender their shares in exchange for shares of our common stock; or
- Spin-Off. A pro rata distribution by Metamor of its shares of our common stock to holders of Metamor's common stock; or
- Combined Split-Off/Spin-Off. A combination of the above transactions.
Metamor has the sole discretion to determine the timing, structure and all terms of its distribution of our common stock. We have agreed to cooperate with Metamor in all respects to complete the divestiture because we believe that our complete separation from Metamor will enhance our ability to pursue our business strategy. Metamor intends to seek a private letter ruling from the IRS that the distribution of its shares of Xpedior common stock to its stockholders would be tax-free to Metamor and its stockholders for U.S. federal income tax purposes. We cannot assure you that the IRS will provide Metamor with a favorable ruling. While it expects to do so, Metamor is not obligated to complete the divestiture. |
