posted on 4/1/2011 11:38:31 AM
The enterprise resource planning software maker Lawson weighs an acquisition offer from ERP serial acquirer Infor, even as industry watchers speculate that Oracle might throw its name into the hat.
ERP provider Lawson Software, which three weeks ago received a $1.8 billion acquisition bid from Infor, reported on Thursday that its software sales increased 6% in the third quarter ended Feb. 28. The news came as reports and rumors speculated that fellow ERP maker Oracle, or even SAP, could make a competing offer.
For the third quarter, Lawson grew ERP license sales by 6% to $33.8 million. License sales represent the smallest piece of Lawson’s revenue pie. Software maintenance contracts are the greatest contributor; they rose 9% to $97.4 million in the quarter. Consulting sales were flat at just under $65 million.
Net income shot up to $21.4 million against $1.7 million in the prior-year quarter. Lawson noted in a press release that it managed to raise operating margins on its M3 ERP software, an offering tailored to the manufacturing and distribution industries.
Since Infor’s offer to acquire Lawson for $11.25 per share in mid-March, the market has signaled that it expects a better offer to surface. In morning trading today, Lawson’s stock flirted with the $12.50 mark.
In the past week, analysts and ERP industry observers have floated various theories on Lawson’s fate. Many have pointed to the potential for an acquisition offer from takeover veteran Oracle, and some have even wondered whether SAP might make a play. To date, no credible evidence has emerged to support the conjecture. Oracle did not respond to inquiries by press time. An SAP spokesperson declined to comment.
Changes in corporate ownership are nothing new to the enterprise resource planning market, but for now Lawson customers are caught in the crossfire of uncertainty. The company has grown quiet in the wake of the Infor offer, having canceled the traditional quarterly earnings call with analysts and the media. But next week, Lawson will set up shop in Boston for its annual CUE customer conference, an exchange of company news and ERP best practices. Managing Automation will be on-site to cover the event.
Lawson’s competitors in the mid-market ERP space include Epicor, CDC Software, and Sage Software. For a detailed look at how Lawson’s M3 ERP software compares to other ERP offerings, click here. (Log-in required.)