Vision Solutions Boasts of Financial Results Post iTera Merger
February 5, 2007 Timothy Prickett Morgan
High availability software vendor Vision Solutions says that the first 60 days of business since it completed its merger with former rival iTera have gone really well–and perhaps even better than anticipated.
Vision Solutions used to be a public company, which meant that it published financial results for investors and the broader market to see. But Vision Solutions was taken private when it was acquired by Thoma Cressey Equity Partners, a private equity firm that invests in a number of high-tech companies, in September 2005. iTera was a privately held upstart, taking on the Big Three in the HA software market–that would be DataMirror, Lakeview Technology, and Vision Solutions–and that meant sometimes iTera talked very generally about its financial performance just to show the kind of traction it was getting in the market. While Vision Solution does not have to talk about its financials in the wake of being taken private, the company nonetheless wants to say something about how it is doing because the numbers are up significantly.
The merger was completed on November 1 last year, and in the 60 days since that time, revenues for the combined companies were up 21 percent. (Vision Solutions did not say how much revenue that was, however.) When companies merge, they often talk about growth after the merger, forgetting to combine the two companies’ revenue streams, which is a bit disingenuous. But in this case, Vision Solutions actually took financial results for both itself and iTera for the same 60-day period four quarters ago (from November 1, 2005, through December 31, 2005) and compared it to the 60-day period most recently–and it has seen a 21 percent revenue growth. Vision Solutions also said that it closed 293 deals in the quarter, with 130 of them being new customers.
“Since the merger was announced we continue to witness increased traction and momentum in all our markets,” said Nicolaas Vlok, chief executive officer at Vision Solutions in a statement. “The merger greatly enhanced our leading position, it expanded our product offerings and created the undisputed global leader for System i high availability. We have exceeded all expectations and anticipate strong growth throughout 2007.”
According to Alan Arnold, executive vice president of technology at Vision Solutions, product sales were driven by iTera product sales in North America as well as sales across the portfolio of products in Europe and Asia. While IBM’s Capacity BackUp editions of the System i5 servers helped in the 60-day period, Arnold said that sales were for core HA and related products for managing databases and replicating data between them. He also said that Vision Solutions was seeing an increase in services, particularly for the Migrate While Active product from iTera, which companies use in conjunction with System i5 upgrades.
As for the 21 percent revenue growth, not only does Vision Solutions think it is sustainable, but that it will continue to snowball. “We think our sales are going to continue to expand,” said Arnold. “We have an excellent backlog of deals, and January was also very good–a record for us, in fact.” As for what is driving the sales increases, Arnold speculates that many iSeries and System i5 shops might have been sitting on the fence, even if they liked a particular product or wanted HA software. But the merger of Vision Solutions and iTera and the backing of a name-brand private equity firm has given them confidence that they can invest in this technology now.
Vision Solutions is working toward a launch of iTera High Availability Version 5.0, a kicker to its Echo2 product from the iTera side of the house. It will be launched “soon,” according to Dan NeVille, executive vice president at Vision Solutions and one of the founders of iTera.