HEALTH software company Isoft has backed down from continuing its legal action to stop US computer company CSC derailing its rescue takeover.

Isoft, based in Banbury, is now locked in talks with CSC, which wants to take a greater role in managing Isoft's work on the multi-million pound updating of NHS computer systems.

The Oxfordshire company is hoping that CSC will remove its veto on a takeover by Australian rival IBA, which would secure Isoft's future.

The company said in a statement to the London Stock Exchange: "While these discussions are in progress, Isoft and CSC have agreed temporarily not to take further steps in court."