The Four Hundred

SSA Global Technologies is on the acquisition path again. Last week Elevon, a publicly traded company that develops e-business applications for IBM mainframe systems, announced that it has agreed to be acquired by SSA GT. The acquisition would be the third in the last year for SSA GT, which also announced last week that Warehouse BOSS, an OS/400-based warehouse management system it acquired last year, can now be directly connected to BPCS, its flagship ERP system.

Elevon, based in San Francisco, announced last Friday that its board of directors has agreed to sell 100 percent of its common stock to SSA GT for $1.30 per share. Based on the number of publicly traded shares, the value of the deal would be $20.25 million. If approved by Elevon shareholders, the company would become a subsidiary of SSA GT, a privately held company based in Chicago.

Elevon did business as Walker Interactive Systems before changing its name to Elevon in 2002, after it acquired a Unix-based application by the same name from a UK software (a product it has since sold). Walker Interactive Systems was delisted by the NASDAQ stock market in 2001.

Elevon sells three core e-business suites that run on IBM mainframes and use the IBM middleware stack, including CICS, DB2, and WebSphere Application Server, and a business intelligence system that runs on Unix platforms. The company's e-finance application suite includes general ledger, fixed assets, and project cost management applications. Its e-procurement suite includes accounts payable, inventory management, and procurement applications, while its e-revenue suite includes billing, accounts receivable, and collections applications. The company also offers an OLAP-based business intelligence tool, called Elevon Active Financial Planning, which it develops in conjunction with its partnerships with Hyperion Solutions and Information Builders. This software runs on Microsoft Windows servers but, presumably, can also be deployed from a Unix or an OS/400 server, as the company's partnerships allow it to use Hyperion's Essbase and IBM's DB2 OLAP Server products. Other Elevon offerings include a collection of query and reporting programs, a collection of portals, and a series of connectors for Java and XML connectivity.

Like many software companies these days, Elevon is struggling to hit its numbers, and this made it a target for acquisition. Elevon had revenues of $41.9 million for its 2002 fiscal year, which ended December 31. That's almost the same as the revenues the company reported for 2001, which were $49.1 million. However, Elevon's revenue stream is now slowing down, as it reported just $6.1 million in revenue for its fourth quarter 2002, compared with $13.2 million for the fourth quarter of 2001. The company reported about $17 million in total equity (assets minus liabilities) at the end of 2002.

Elevon's chief executive officer says the acquisition is in the best interest of shareholders, customers, and employees. "We will work hard to ensure a smooth transition for our customers into the SSA GT organization," says Elevon's CEO Frank Richardson. "Elevon and SSA GT share similar views of the market." Mike Greenough, SSA GT's president, chairman, and CEO, says, "Elevon's customers will benefit from SSA GT's stable, high growth and global environment."

In other SSA GT news, the company announced last week that Warehouse BOSS, an OS/400-based warehouse management system that it acquired from Computer Associates last April, can now integrate directly with BPCS, SSA GT's original ERP system. Warehouse BOSS was one of 13 enterprise applications that SSA GT tucked under its wing when it acquired the interBiz unit of Computer Associates. Warehouse BOSS helps companies to manage many aspects of a warehouse or distribution center operation, including shipping, receiving, locating, order management, and replenishment.

At the time of the interBiz acquisition, SSA GT officials said integrating Warehouse BOSS with BPCS would be one of the first cross-application integrations on their list to complete. Computer Associates had already developed an interface between Warehouse BOSS and PRMS, the OS/400-based ERP suite that brought the most seats, and there were also interfaces between Warehouse BOSS and KBM, another OS/400-based ERP system that came over in the interBiz acquisition.