Danka Business Systems has achieved the first stage of an ambitious plan to cut its 376m debt by selling Danka Services Interna-tional for 204m ($290m) to Pitney Bowes.


The sale of the document outsourcing and repro management division is part of a three-point scheme, which also includes a corporate bond exchange and refinancing, to reduce Dankas debt.


The proceeds of the sale which should be finalised within two months will be used primarily to repay a chunk of Dankas bank debt.


Danka UK managing director Paul Dumond said Danka came close to selling DSI in 1999 to Schroder Ventures but the deal fell through after IBM threatened to end its service agreement.


All three parts of the strategy should be completed by the end of June, added Dumond.