Software AG says sale unlikely

Company structure key to middleware vendor's future

Written by Martin Veitch

Middleware firm Software AG has played down reports linking it with a sale to Hitachi, and hit back by suggesting that rivals could be sold this year.

Shares in the German firm leapt this week on speculation that Hitachi could be the latest company to acquire its way to a role in integration software.

BEA Systems, WebMethods, SeeBeyond, JBoss and Ascential have all been acquired in the last few years, boiling down the leading competition in middleware to giants IBM, Oracle and SAP, and specialist Tibco.

However, Software AG chief technology officer Peter Kurpick said that the way the company is structured means it is far less likely to be acquired than others in the sector. “We’re still standing alone because we’ve been successful in driving out stock and because the Software AG Foundation owns about 30 per cent of the company and wouldn’t want to sell, so that would make it very difficult for an acquisition to happen,” Kurpick said.

Kurpick said that a more likely scenario is the acquisition of fellow independents.

“I see mergers and acquisitions even speeding up in 2008,” he said. “I can easily see that [Tibco] will be gone and that makes our visibility greater.”

Tibco chief executive Vivek Ranadive alerted observers to the possibility of a sale late last year when he said the company was an attractive target. Also last year, BEA was the target of a bid from Oracle but the pair could not agree a price.

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