TechnologyAccounting SoftwareGeac bids for JBA

Geac bids for JBA

JBA shareholders say the price isn't right despite the board's acceptance of offer.

Users of enterprise vendor JBA’s AS/400 software could receive acceptance of offer. technology boost if Geac’s proposed £92.5m takeover overcomes concerns from JBA shareholders that the offer is too low.

The companies’ combined revenues in 1998 exceeded £500m. Geac chief executive Douglas Bergeron claimed the expanded Geac would be ‘one of the largest software companies in the world and a leading force in the ERP marketplace’.

The bid follows last month’s 8% cut in JBA’s workforce after a second fall in annual pre-tax profits. JBA still has a large section of users on IBM AS/400 minicomputers and lacks a client-server product, in contrast to Geac.

The bid has been accepted by the board, but JBA shareholders – including Specialist Computer Holdings which owns 11.8% – have said the cash offer of £2.50 a share is too low. Last year JBA shares hit £12.57.

At least 90% of JBA shareholders have to accept the offer for the bid to go ahead.

Geac, which acquired Dun & Bradstreet Software in 1996, is keen to expand in the UK particularly in the manufacturing sector where JBA is strongest.

It plans to run JBA as a separate business but refused to comment on whether the takeover would create job losses.

Last year Geac merged its mainframe and client server businesses, creating SmartEnterprise Solutions to provide a more unified service.

Richard Smith, divisional manager for Geac’s SmartEnterprise business division in the UK, said JBA’s large AS/400 customer base would complement Geac’s client-server-based applications.

‘We have had a great deal of success in letting our customers transfer from one platform to another,’ said Smith. But JBA users gave a guarded welcome to the Geac takeover prospect.

Phil Ralfe, project manager at Paddington Churches Housing Association, said: ‘It will be good if Geac invests in JBA infrastructure and software but I don’t know how much more we will be paying in licence fees.’

But the Geac acquisition trail is unlikely to end with the takeover of JBA. Smith added it was keen to make further purchases in the business software market. ‘I don’t think it’s over yet,’ he said.

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