Hewlett Packard Enterprise Co. on Tuesday said it would spin off its enterprise services business and merge it with Computer Sciences Corp., creating an information-technology services company with $26 billion in annual revenue.

Hewlett Packard Enterprise said the move "is the logical next step in the turnaround" of its enterprise services business and will allow the remaining company to focus on its server and other data-center gear businesses.

Following the transaction, Hewlett Packard Enterprise shareholders will own Hewlett Packard Enterprise and 50% of the new company.

The new company will be led by Mike Lawrie, who is chairman, president and chief executive of Computer Sciences. Meg Whitman, president and CEO of Hewlett Packard Enterprise, will join the new company's board, which will have an equal amount of nominees from both companies.

Write to Tess Stynes at tess.stynes@wsj.com

(END) Dow Jones Newswires

May 24, 2016 16:45 ET (20:45 GMT)

Copyright (c) 2016 Dow Jones & Company, Inc.
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