Lawson Stockholders Approve Intentia Acquisition
April 24, 2006 Dan Burger
Lawson Software and Intentia International, two ERP software vendors with OS/400-based products and an ongoing effort to merge companies, cleared a big hurdle in the merger process when last week Lawson stockholders voted in favor of the deal. Plans that detailed Lawson’s $480 million stock transition for the acquisition of Intentia were first revealed in June 2005. It appears as though the two companies will now close the transaction by the end of April.
Lawson reported that 74.5 percent of shareholders voted in favor of the agreement. The vote clears the way for the issuance of about 81 million shares of Lawson common stock in exchange for all of Intentia’s Series A and Series B shares and outstanding warrants to purchase Series B shares.
As a result of this merger, Lawson will have a far greater breadth of products in the midrange market and greater coverage on a global basis. Lawson has a reputation that is known primarily in the healthcare, financial services, retail, and government sectors within the United States. It’s strength lies with software and services relating to human resources, procurement, retail operations, and service process optimization. Intentia’s software and services pertain to the manufacturing and distribution businesses and its customer base is centered in the European and Asia/Pacific markets. Its software is designed for improving enterprise and supply chain management.
After the acquisition, which the two companies hope to close well before the end of the year, the new Lawson will have 45 percent of its sales in the Americas, 45 percent of its sales in Europe, and 10 percent in Asia/Pacific. Its applications will be running at about 4,000 customer locations and will be available in 40 countries and more than 40 languages.
More than 90 percent of Intentia customers rely on the iSeries to run their Movex enterprise software. That’s approximately 3,000 iSeries shops. Lawson’s iSeries customer base is approximately 350 customers. While both companies support RPG-based versions of their software, Intentia has already rewritten its applications in Java and has moved some customers to that product. Lawson has announced its intention to also convert its applications to Java, but is just beginning that process.
Lawson officials say the company will continue to develop and support the software suites that each company currently markets.
Earlier this month, Lawson reported its third quarter financials, which are starting to look up a bit. Compared to its fiscal 2005 third quarter, revenue increased from $82.7 million to $87.7 million, license fee revenues climbed from $13.9 million to $15.1 million, and service revenues rose from $68.8 million to $72.6 million. On a year-over-year comparison, GAAP net income was $20.7 million based on total revenues of $264.6 million in contrast to a net loss of $700,000 on total revenues of $248.4 million in the same nine-month fiscal period during 2005.
Lawson Software has its headquarters in St. Paul, Minnesota. Its European headquarters will be in Stockholm, Sweden, the former headquarters of Intentia.