UK-based Invensys has all-but finalised its $US709 million acquisition of financially strapped Baan, announcing that it now controls 72 per cent of Baan's stock under a tender offer that expired earlier this month.
Invensys said it's assuming immediate management control of Baan and providing the Netherlands-based business applications vendor with new financing that Baan needs to continue operating. Baan, which has lost money for eight straight quarters and gone through four CEOs since mid-1998, had said two weeks ago that its financial problems were raising "significant uncertainties" about the company's ability to stay afloat without help from Invensys.
However, one formality remains before the takeover by Invensys can be completed. Baan recently scheduled a special shareholders' meeting for August 18 in the Netherlands, at which the deal with Invensys will be put forward for approval.
But with Invensys now controlling a majority of Baan's shares, the vote should be little more than a rubber stamp for the acquisition. In its announcement, Invensys said it already has bought 25 per cent of Baan's shares and has commitments to purchase another 47 per cent.
Invensys - which is expected to lay off up to 800 Baan employees as part of a planned overhaul of the software vendor - originally had set a condition of getting 95 per cent of Baan's shares in order to go ahead with the deal. It fell well short of that level, despite an extension of the tender offer for Baan's shares, but Invensys officials decided to go ahead with the deal anyway.