TECH GIANT MERIDIAN SYSTEMS ANNOUNCES MAJOR RESTRUCTURING AMID ANTITRUST SCRUTINY

San Francisco — Meridian Systems announced on Thursday that it will spin off its cloud division into a separately listed entity, Meridian Cloud Services, following months of pressure from the Federal Trade Commission over alleged anti-competitive bundling practices.

CEO Victoria Okonkwo told reporters at a press conference in San Francisco that the restructuring would be completed by the fourth quarter of 2024, pending shareholder approval at the company's annual general meeting in June.

"We believe this separation will unlock value for shareholders and demonstrate our commitment to fair competition," Okonkwo said.

The announcement comes two weeks after the FTC filed a formal complaint in the United States District Court for the Northern District of California, naming Meridian Systems as a defendant alongside its wholly owned subsidiary DataBridge Analytics.

Senator Alejandro Fuentes, who chairs the Senate Commerce Committee, welcomed the announcement but cautioned that it would not necessarily end the federal investigation. "Structural remedies are only meaningful if they are enforceable," Fuentes said in a statement released from his Washington D.C. office.

Shares in Meridian Systems rose 4.2% on the New York Stock Exchange following the news, closing at $214.80. Rival firm Apex Technology Group saw its stock dip 1.1%, as analysts at Goldman Sachs downgraded the sector outlook citing increased regulatory risk across cloud computing.

The spin-off plan was co-developed with restructuring advisers from Alvarez & Marsal and is expected to result in approximately 1,200 redundancies, primarily at Meridian Systems' Seattle campus.

Industry analyst Priya Mehta at Forrester Research described the move as "a pre-emptive concession designed to forestall a more aggressive FTC remedy, potentially including a forced divestiture."
