Enterprise software vendor Great Plains has announced plans to acquire longtime rival Solomon Software in a cash and stock transaction valued at about $US140 million.
According to the company's local regional director, Bob Smith, the two companies have followed "parallel tracks" for over 20 years. Now, finally, Great Plains has seized the opportunity to "merge companies. It's essentially the number one company buying the number two company," Smith said.
Smith said a major similarity between the competing businesses had been a heavy reliance on channel partners for product distribution. The two companies will enjoy a combined worldwide distribution network of over 2000 channel partners, he said.
Great Plains expects its customer base to grow by some 20,000 to 130,000.
The companies, which have offices in Australia, make software that helps mid-size companies manage aspects of their business such as financials, distribution, project accounting and manufacturing.
Great Plains defines the mid-market space as companies with revenues of between $US1 million and $250 million.
Terms of the definitive merger agreement call for Great Plains to issue about 2.6 million shares of Great Plains common stock and $US35 million in cash. Solomon will operate as a business unit of Great Plains, and will continue to develop the Solomon family of business applications, Great Plains said.