Apps Vendor Infor Bulks Up With Extensity, SU

Infor Global Solutions will buy two more enterprise applications players, Extensity and Systems Union Group (SU), the purchase-hungry company said Wednesday.

Infor wants to build sufficient critical mass through acquisitions to better position its offerings against market leaders SAP and Oracle.

Last week, Infor closed the US$1.4 billion purchase of SSA Global announced in May. That deal catapulted Infor into third position size-wise behind SAP and Oracle in the business applications market.

With the latest acquisitions under its belt, Infor has annual revenue of $2.1 billion, offices in 100 countries and about 70,000 customers. The company also said it has a major presence among midsize applications customers, a market that both SAP and Oracle are targeting heavily.

Infor already had a close relationship with Extensity, both companies are funded by private equity firm Golden Gate Capital, and Ken Walters, the chief executive officer of Extensity, was previously president and chief operating officer of Infor.

When Golden Gate agreed to buy business software vendor Geac for $1 billion in November, it said it would break Geac into two. Infor gained Geac’s ERP software, while Golden Gate formed a new firm, Extensity, to house Geac’s financial and performance management applications. With Infor’s purchase of Extensity, the Geac portfolio is reunited under one roof.

In March, as Golden Gate closed the Geac acquisition, Extensity formally came into being. At that time, Extensity laid out ambitious plans to become a $1 billion independent applications company within three years. The new company had planned to close its first acquisition, the purchase of U.K. software firm Systems Union for just under US$400 million, in late July.

Infor didn’t put a specific price on the acquisitions, but talked about a two-stage transaction financed by cash on its balance sheet and debt financing including a $150 million in revolving credit, a $2.2 billion term loan and a $1.4 billion bridge.

Infor has yet to make clear its product road map for the wide variety of applications it has picked up from different vendors, but has talked vaguely about extending the life of existing software while offering a path to unspecified new technologies.

-China Martens, IDG News Service (Boston Bureau)

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