U.S.-based IT services provider Kyndryl Holdings is planning to separate its China business and has told some employees about the decision, the Financial Times reported on Wednesday, citing three people with knowledge of the matter.
The firm has, however, not laid out details of when the split would take effect or who will control the China entity, the report said, adding that the move would affect roughly 6,000 staff in Hong Kong and mainland China.
Kyndryl, listed in New York, is an IT infrastructure services provider with operations across 60 countries and counts cloud providers Alphabet’s Google and Microsoft as its customers.
Enterprise software provider IBM in 2020 announced a plan to separate its managed infrastructure services business and a year later named the spun off company Kyndryl.
U.S. companies like Kyndryl have been caught in the fallout from US-China tensions in both countries. China has criticised U.S. efforts to block its access to advanced technology and U.S. firms have expressed concern about fines, raids and other actions that make doing business in China risky.
Political tensions and a slowing economy have been sapping the confidence of U.S. businesses operating in China, with the number of companies optimistic about their five-year outlook falling to a record low, a survey published earlier this month showed. Reuters