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_________________________________________________________________
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_________________________________________________________________
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
______________
Date of Report (Date of earliest event reported) May 13, 1996
J.P. MORGAN & CO. INCORPORATED
(Exact name of registrant as specified in its charter)
DELAWARE 1-5885 13-2625764
(State or other juris- (Commission (IRS Employer
diction of File Number) Identification No.)
incorporation)
60 WALL STREET, NEW YORK, NEW YORK 10260-
0060
(Address of principal executive offices) (Zip
Code)
Registrant's telephone number, including area code (212) 483-
2323
_________________________________________________________________
(Former name or former address, if changed since last
report)
_________________________________________________________________
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ITEM 5. OTHER EVENTS
On May 13, 1996, the Registrant issued a press release
announcing
its intent to join Computer Sciences Corporation,
Andersen
Consulting, AT&T Solutions, and Bell Atlantic Network
Integration in
a global alliance to manage parts of the Registrant's
global
technology infrastructure. A copy of such press release
is filed
herein as Exhibit 99.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION
AND EXHIBITS
(a) Financial Statements
NONE.
(b) Pro Forma Financial Information
NONE.
(c) Exhibits
99. Copy of press release of J.P. Morgan & Co.
Incorporated dated May 13, 1996.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the
registrant has duly caused this report to be signed on its behalf
by the
undersigned hereunto duly authorized.
J.P. MORGAN & CO. INCORPORATED
______________________________
(REGISTRANT)
/s/ PATRICIA A. JONES
________________________
NAME: PATRICIA A. JONES
TITLE: MANAGING DIRECTOR
DATE: May 13, 1996
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EXHIBIT INDEX
Exhibit 99 - Press release of J.P. Morgan & Co.
Incorporated
dated May 13, 1996.
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Exhibit 99
May 13, 1996
J.P. Morgan joins with leading information technology firms in a
global
alliance to manage parts of its technology infrastructure
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J.P. Morgan, Computer Sciences Corporation, Andersen Consulting,
AT&T Solutions, and Bell Atlantic Network Integration today
announced an agreement in principle to form a strategic alliance,
the first of its kind, to manage parts of Morgan's global
technology infrastructure. The Pinnacle Alliance, as the new
consortium will be known, is designed to expand MorganOs access
to world-class technological resources and build its competitive
strength as a leader in global finance. The value of the seven-
year agreement is estimated at more than $2 billion. A final
agreement will be negotiated within the next few months.
The agreement will give Morgan added flexibility to tailor
technology use to changing business needs, capitalizing on the
AllianceOs substantial processing capacity and economies of scale
to make technology costs more variable. Morgan also will be able
to tap the technological expertise of the Alliance to support the
firm's new business and product development activities.
The Pinnacle Alliance will manage activities that represent about
a third of Morgan's $1 billion of annual technology expenditures.
The Alliance will manage the firm's data centers in New York,
London, and Delaware; distributed computing operations (such as
desktop support and local area networks) and voice and data
services in New York, Delaware, London, and Paris; and certain
internal corporate applications in the United States and Europe.
All of the approximately 900 Morgan employees in areas covered by
the agreement will remain in their jobs as employees of one of
the Alliance firms.
"Technology is critical to J.P. MorganOs success -- so critical,
and on so many specialized, fast-developing fronts, that no one
firm can be a leader in all of them," said Douglas A. Warner III,
chairman of J.P. Morgan. "Teaming up with these firms will put
us at the forefront of creative, flexible management of
technology -- increasing our ability to exploit new technologies,
manage costs, and create competitive advantage."
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John M. Mickel, lead executive of the Pinnacle Alliance, said:
"We are delighted to enter into this working partnership with
J.P. Morgan. This is truly a landmark agreement for the
information technology industry. Pinnacle brings together
organizations that are leaders in their fields and marks a new
approach in providing sophisticated technology support services."
Morgan expects to achieve aggregate savings of approximately 15
percent on projected technology costs over the life of the
agreement, after an estimated $100 million transition expense
mainly related to the sale of certain technology equipment to
Alliance firms, training, and other personnel expenses. The
transition expense is expected to be recorded in the 1996 third
quarter upon completion of an agreement.
Peter A. Miller, co-head of Corporate Technology at J.P. Morgan,
said: "The Alliance will give us access to the bench strength of
leading firms to meet the growing technology needs of our global
business. It also will free up our internal technologists to
focus on strategies and innovations that give Morgan a
competitive edge."
The Alliance is designed to be seamlessly integrated with
Morgan's global technology management structure. Among the
features of the Alliance is the establishment of a Alliance
Operating Team, comprising executives from each of the Alliance
companies and J.P. Morgan, which will allocate resources and
manage the activities of the Alliance. "The formation of a
management team made up of key executives from all the companies
is a first for a technology services agreement," said John
Mickel. "The team's job will be to make sure that Morgan's needs
get prompt attention and that the Alliance moves fast to help
Morgan seize new opportunities."
The agreement will take the form of a service contract between
J.P. Morgan and Computer Sciences Corporation; CSC in turn will
have contracts with other members of the Alliance spelling out
their roles. The primary responsibilities of each Alliance
company will include:
-J.P. Morgan - Responsible for setting the strategic
direction for the Alliance.
-Computer Sciences Corporation D Lead company in the
Alliance, with overall responsibility for data centers and
mainframe, midrange, and distributed operations worldwide.
-Andersen Consulting D Responsible for applications
development and maintenance support.
-AT&T Solutions D Responsible for global network operations
management.
-Bell Atlantic Network Integration D Responsible for
supporting distributed computing services in the United States,
such as desktops, local area networks, and servers.
Additional information on the Alliance companies and the scope of
the agreement is attached.
# # #
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Information on the Alliance companies
J.P. Morgan is a leading global banking firm that serves clients
with complex financial needs through an integrated range of
advisory, financing, trading, and investment capabilities.
Headquartered in New York, it employs 15,000 professionals in 28
countries. Revenues in 1995 were $5.9 billion; net income was
$1.3 billion.
Computer Sciences Corporation had $4.2 billion in annual revenue
for the 12 months ended March 29, 1996. The company is
headquartered in El Segundo, California, and has 34,000 employees
worldwide providing clients with a wide range of professional
services, including management consulting, business
reengineering, and information systems consulting and
integration, and outsourcing.
Andersen Consulting is a $4.2 billion global management and
technology consulting organization whose mission is to help its
clients change to be more successful. The organization works
with clients from a wide range of industries to link their
people, processes, and technologies to their strategies.
Andersen Consulting has more than 38,000 persons in 47 countries.
AT&T Solutions is the professional services division of the AT&T
Corporation, the worldwide leader in providing telecommunications
services to businesses and consumers. AT&T Solutions offers
services that are linked to providing seamless solutions and
maximizing the application of electronic commerce. With
headquarters in Washington, DC, AT&T Solutions has more than
11,000 business and technology professionals located around the
world providing service to more than 200 clients.
Bell Atlantic Network Integration, a subsidiary of Bell Atlantic
Corporation, offers services covering the full life-cycle of the
planning, deployment, and management of enterprise networks.
This includes consulting, integration, outsourcing, and ongoing
support of enterprise networks. Bell Atlantic Corporation is at
the forefront of the new communications, entertainment, and
information industry. In the mid-Atlantic region, the company is
the premier provider of local telecommunications and advanced
services. Globally, it is one of the largest investors in the
high-growth wireless communication marketplace.
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Key facts on the Alliance agreement
Scope and definitions
The agreement covers Morgan's data centers in New York, London,
and Delaware; distributed computing operations (such as desktop
support and local area networks) and voice and data services in
New York, Delaware, London, and Paris; and certain corporate
applications in the United States and Europe.
-Data centers are facilities equipped with mainframe and
midrange computers and related equipment designed to handle the
large-scale processing associated mainly with the sale and
trading of securities, foreign exchange, and other financial
instruments.
-Distributed computing operations are functions that support
the servers, local area networks, and desktop workstations that
provide electronic mail, network connections, and personal
computer productivity tools that are used daily by Morgan
professionals.
-Voice and data services support Morgan's global data
networks, telephone systems in offices and trading floors, and
video teleconferencing facilities.
-Corporate applications support firmwide functions such as
payroll and financial reporting.
All other technology services at Morgan are excluded from the
agreement, including technology strategy and management, systems
planning, vendor management and industry relations, and
development and maintenance of trading applications and other
business-specific systems. Technology support for the firmOs
Private Banking and Investment Management activities and for the
Euroclear Operations Centre also are excluded.
Experience
Although considerably larger in scope, the Alliance agreement
builds on earlier pioneering efforts by J.P. Morgan to strike
innovative service agreements with technology providers. In 1992
Morgan reached separate agreements with AT&T, MCI, and British
Telecom to operate certain data and voice communication networks,
and last year Morgan contracted with IBM for technology support
in Tokyo.
The impact on people
The treatment of people was one of the top priorities Morgan
considered when selecting an Alliance partner. MorganOs
technologists have a unique set of financial industry and Morgan-
specific skills that are critical to the success of this venture.
The agreement does not eliminate any jobs. Most of the
approximately 900 Morgan employees within the scope of the
agreement (representing about 45% of our current staff of
technologists) will receive a job offer from one of the Alliance
companies and will continue to work at Morgan locations. A small
number of Morgan employees covered by the agreement will remain
with the firm to manage Morgan's role in the Alliance.
