JDA Software to Acquire ManugisticsBy Renee Boucher Ferguson | Posted 2006-04-26 Email Print
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The once high-flying supply chain management software provider Manugistics has succumbed to consolidation.
Scottsdale, Ariz.-based JDA Software Group announced April 24 that it is acquiring SCM stalwart Manugistics for $211 million in cash, or $2.50 a share.
By combining the two companies, JDA plans to establish itself as a leading, vertically focused global supply chain software provider for manufacturers, wholesalers, distributors and retailers.
"No other software company will be able to offer a similar breadth and depth of solutions to the very large, vertically focused demand chain market," said JDA CEO Hamish Brewer, in a statement. "This deal is as close to a perfect match as you can get for an acquisition of this size. Only JDA can bring the product, market and industry leadership that will position Manugistics for a new era of growth."
Pending a successful acquisition of Manugisticsthe deal is expected to close during the second or third quarter this yearventure capitalist Thomas Cressey has agreed to invest $50 million in JDA software to help it along its path.
Manugistics, founded in 1986 in Rockville, Md., has been on the ropes for several years. Throughout most of its history it was cited by analysts as a leader in the development of the supply chain planning market. But as that market shifted to a more complex model in the late 1990s, Manugistics ceded its lead to i2 Technologies and never regained its hold. (Following JDA's acquisition announcement, i2 announced free integration services of Manugistics applications to the i2 Agile Business Process Platform.)
In 2004 AMR Research listed Manugistics as the seventh-largest SCM software provider.
"After extensive due diligence, we believe that merging with JDA is the best path forward for all our stakeholders," said Manugistics CEO Joe Cowan, in a statement.
The combined JDA and Manugistics company will have annual revenue of more than $390 million with more than $170 million in annual maintenance revenue, according to JDA officialsan earnings spike that could put JDA in place as the world's fourth-largest player in the SCM marketparticularly in the retail sector, according to AMR.
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