23 June 2003 Geac, Canada’s largest software company and a rival to SAP, Oracle and PeopleSoft in high end financial software, has joined in the software industry’s acquisition frenzy with the announcement that it plans to acquire Comshare, one of the oldest software companies in the US, for $52 million.
The purchase will create a specialist financial and business performance management software company with sales of around $590 million and around 20,000 customers worldwide.
Both companies have suffered strategic and financial difficulties in recent years, but have largely weathered the storm. With sales of US$529 million in its last full year, and profits of US$38 million, Geac remains outside the top tier of enterprise resource planning (ERP) software vendors. But its strong concentration on real-time financials has earned it respect and new customers.
In 1999, Geac acquired JBA Software, then one of the UK’s biggest software companies and the world’s fifth biggest ERP software vendor, for £92 million.
Comshare claims to been have been the first company in the world to have produced an executive information system (EIS), capable of pulling in data from several operational systems and presenting it to managers in a comprehensible form.
However, Comshare has been eclipsed by the emergence of integrated business intelligence suites, as well as the introduction of integration and portal software.
Nevertheless, the merger will enable Geac to claim a clear technical and market lead in the fashionable area of business performance management — providing real-time financial and analytic data on the performance of a business.
The agreed bid by Geac represents a premium of one-third on Comshare’s recent share price. “Comshare is expected to add roughly 12% to Geac’s annualised revenue,” said Geac CEO Paul Birch. “Geac can now participate in a new US$1 billion market growing over 10% per year.”