Peregrine to buy rival Remedy for $1 billion

Peregrine to buy rival Remedy for $1 billion

E-business infrastructure software maker Peregrine Systems has agreed to buy rival Remedy in a cash and stock deal valued at more than $US1 billion, the companies revealed.

Peregrine said the goal of the deal is to extend the depth and scope of its product line. The acquisition will match Remedy's base of small and midsize customers with Peregrine's array of global enterprise customers, Peregrine said. Additionally, Peregrine said the combination will give customers the flexibility to combine Remedy's highly customizable applications with Peregrine's one-size-fits-most offerings.

Peregrine said that the Remedy IT Service Management (ITSM) suite will become the company's flagship package for small-to-midsize organizations, while its own Peregrine products will remain its primary offering for large enterprise customers. Peregrine also said it intends to combine its own infrastructure management products with Remedy's business process authoring technology, the AR System. Peregrine said it will deliver the Action Request (AR) System 5.0 during the fourth quarter of 2001.

Shareholder approval of the acquisition is still pending. Shares of Peregrine (PRGN) were down 16.8 per cent on the Nasdaq exchange on Monday, to $US23.97, while shares of Remedy (RMDY) soared 62.3 per cent to trade at $29.77, also on the Nasdaq.

Peregrine's buyout deal offers Remedy shareholders $9 cash and 0.9065 shares of Peregrine common stock in exchange for each share of Remedy. Based on Friday's closing prices, the deal values Remedy shares at $35.12 each, a 91.5 per cent premium over Remedy's $18.34 closing price at the end of trading last week.

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