The Four Hundred--DataMirror Hires Top Vision Executive, Increases IDION Stake

DataMirror's unsolicited bid in 2002 to buy rival OS/400 high availability software provider Vision Solutions was jolted back to life last month, when a top Vision Solutions executive, Rean Pretorius, left the company, joined DataMirror, and sold all his shares in IDION Technology Holdings, Vision's parent company, to DataMirror. Vision's loss is DataMirror's gain, as DataMirror's ownership of IDION shares rapidly approaches the 50 percent mark.

When DataMirror launched its bid for South Africa-based IDION, in March of 2002, the company already owned about 17 percent of IDION. Four months later, when DataMirror announced its closure of the bid, DataMirror had increased its ownership in IDION to about 38 percent. IDION executives, who always opposed the acquisition, said DataMirror would be unable to garner the 50-percent-plus-one majority needed to claim control of the company.

Over the last 12 months, however, DataMirror has continued to acquire shares of IDION on the open market and is now poised to make an offer that could close the deal. Following the sale of Pretorius' 4.3 million shares to DataMirror, on October 10, the Toronto, Ontario, company now owns nearly 42 percent of IDION and is expected to make another bid. According to a letter from IDION to shareholders, DataMirror's ownership of IDION is "rapidly approaching" a level at which DataMirror must make an offer to shareholders to purchase the remaining shares, which DataMirror indicated to IDION will likely be at a premium to the 2.20 (Rand) price that Pretorius sold out at. IDION's stock is traded on the Johannesburg (South Africa) Stock Exchange.

Rean Pretorius is a veteran of the OS/400 high availability software market and is the latest to play musical chairs among the major providers. He joined Vision Solutions as executive vice president of worldwide sales in 2000, when IDION bought Vision Solutions, a private company, for $62.5 million. Pretorius joined IDION two years earlier, when IDION, led by its chief executive, Nicolaas Vlok, bought Pretorius' South African company, Silverlake Technology Solutions, an IBM premier business partner that developed OS/400 clustering and logical partitioning technology. Following that acquisition, Pretorius retained his position as chief executive officer at IDION.

Incidentally, the technology that Pretorius helped to develop at Silverlake, called Continuous Availability Tool for Service (CATS) and Application Cluster Enabler (ACE), eventually made its way to the third major OS/400 high availability software developer, Lakeview Technology, which had a licensing agreement with IDION to use CATS and ACE to develop OS/400 clustering. (Lakeview, you will remember, is the company that Pretorius' former colleague at Vision Solutions, David Wegman, an executive vice president of marketing and business development, left in late 2001 to join Vision Solutions [see "Wegman Has a New Vision"].)

Executives in highly competitive industries like this will often sign non-compete clauses, to prevent losing valuable trade secrets to their closest rivals. Although Lakeview entertained thoughts about enforcing the non-compete clause it had with Wegman, there was never any legal action taken; the separation, if not amicable, was deemed to be mutually beneficial. That does not appear to be the case with Pretorius and Vision. A spokesperson for Vision said the company's lawyers have advised the company against commenting on Pretorius actions.

Sources close to the story say Pretorius was at odds with Vision's new product strategy, which hinges around Orion, its new cross-platform high availability solution. As the head of Vision's sales department, Pretorius was in line for the credit or the blame, depending on how things went. Sales are off at Vision, the source says, and Pretorius was taking the heat.

At DataMirror, Pretorius is the senior vice president of resiliency sales. His immediate responsibility will be, curiously, the sale of iReflect, the company's availability product for Oracle.

A spokesperson for DataMirror declined to comment further about Pretorius, nor about DataMirror's renewed bid for IDION.

This article has been corrected since it was first published. The title was changed from "DataMirror Raids Vision for Top Executive, Renews IDION Bid" to "DataMirror Hires Top Vision Executive, Increases IDION Stake." Guild Companies regrets the error. [Correction made 11/4/03.]