The purr-fect offer?

Last week’s share-for-share offer for Tetra from Oxford-based Lynx Group looks set to give a boost to the users of Tetra’s C/S3 financials and ERP software.

Tetra management were tight-lipped immediately after the bid, which has yet to be accepted by the company’s board, but indicated that it was considered a friendly offer.

Software analysts have been expecting a wave of consolidation to take place in the crowded mid-range market for financial and ERP software, but accepted thinking is that takeovers would wait until after the millennial dust settles next year.

C/S3 user Jonathan Whiteley, finance director at Halifax-based bed manufacturer Dor-lux, was mildly surprised by Lynx’s offer, but said: ‘Provided that my system is not compromised – and they would be foolish to tamper with what is an excellent product – then I think it will be business as usual.’

Dorlux managing director Peter Hewitt said the company chose Tetra C/S3 because it matched the company’s functional needs and gave Dorlux the ability to add new modules in the future.

The bed manufacturer is currently working with Hull-based reseller MPS to link C/S3 to DPS planning software.

‘We also like to think that when we chose Tetra, we weren’t just choosing a good functional product, but were backing the right horse to take us beyond the next three to five years,’ added Whiteley.

Lynx, which turned over #121m in the 1997 financial year, and is capitalised at #200m, is well known in the accountancy software sector, as it owns Apex, a reseller of both Tetra and SAP enterprise resource planning software.

It has snapped up a string of IT companies over the past year or so.

In 1997, Lynx made an approach to Kalamazoo, a developer of manufacturing software and a Tetra reseller. ‘Lynx is a highly acquisitive organisation that is doing very well at the moment,’ said Kalamazoo marketing director Andy Peart. ‘And Tetra is a prime target. The ERP market is growing at 30% a year and consolidating as bigger players get bigger.’

C/S3 was a strong product, and a Lynx link could carry Tetra into new markets if its new corporate parent decided to acquire further software companies. ‘From a customer point of view, the acquisition should be positive,’ said Peart.

While users should benefit from a Lynx takeover, some Tetra resellers could be nervous should Lynx decide to favour Apex over other dealers.

‘At Apex, they already have experience of managing potentially competitive situations, so there is no reason to believe they won’t be able to handle the Tetra situation,’ said Peart.

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