DATE: Wednesday, September 17, 1997         TAG: 9709170504

SECTION: BUSINESS                PAGE: D2   EDITION: FINAL 

SOURCE: BY AKWELI PARKER, STAFF WRITER 

DATELINE: VIRGINIA BEACH                    LENGTH:   42 lines

METRO INFORMATION GIVES UP ON ACQUIRING TECHNOLOGY FIRM

Metro Information Services Inc.'s bid to acquire KCS Computer Services Inc. has fallen through, Metro said Tuesday.

Metro President and CEO John H. Fain said the company is still on the lookout for attractive acquisitions, including in Pittsburgh and Cleveland, where KCS operates.

Virginia Beach-based Metro specializes in the unglamorous but greatly in-demand business of information technology consulting: a broad array of high-tech services that include things like stringing computer cable and exterminating Year 2000 Bugs in old mainframes.

Metro, which acquired two companies in July, said it isn't concerned about the loss of KCS, a privately held information technology provider.

``Metro remains focused on its growth strategy which includes internal growth through new office openings and external growth through selective acquisitions,'' Fain said.

Metro announced its intention to acquire KCS in August but did not disclose the terms. Metro did not reveal the cause of the deal's breakdown other than to say the companies disagreed on too many things.

KCS did not return phone calls to The Virginian-Pilot.

The prospect of grabbing KCS was particularly appealing to Metro because of KCS's location in the robust Pittsburgh and Cleveland markets.

The plan was to keep all of the KCS consulting staff in the event of a deal, Metro said in August.

Metro, which started nearly 17 years ago with barely a handful of workers, now employs more than 1,750 and recorded $114 million in net sales last year.

Metro stock went public in January with an initial price of $16 a share. Its closing price Tuesday was $23.8125, up $1.0625.

The company's goal is to open three to five offices per year. It's notched five already this year and has 28 throughout the United States and Puerto Rico.

``There's a lot of acquisition activity going on in our industry right now,'' said Bob Eveleigh, Metro chief financial officer.

Metro, he said, plans to continue in the thick of that activity as it ``finds the right candidates.''

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