S.J. software company buying rival
Business Objects to Pay $820
Million for Crystal
July 19, 2003 -- By Aaron Davis
Software maker Business Objects of San Jose will acquire Crystal Decisions of Palo Alto for $820 million in cash and stock, the companies announced Friday.
The combination creates a 3,800-person company that will be the largest in the fledgling market for ``business-intelligence'' software that lets companies better track sales and other performance measures through improved database management.
Crystal Decisions had recently announced plans to go public -- one of only a handful of Silicon Valley companies to do so in the last few years.
The acquisition continues a trend of consolidation in the software market, but executives said Friday that the deal would not preclude Crystal from making a separate public offering.
"The way we're thinking, if they go public now it will be a supercharged IPO," said Dave Kellogg, senior vice president for worldwide marketing at Business Objects.
Business Objects on Friday also announced preliminary earnings of 17 cents to 18 cents a share that met analysts' expectations. Revenue is expected to be $127 million to $129 million.
Its shares fell 71 cents, or 3.5 percent, in after-hours trading to $19.55. The stock had gained 63 cents Friday to close at $20.26.
Crystal had sales of $270 million for the 12 months ended in March. Business Objects had sales of $466 million for the 12 months ended in March.
Under the deal, Business Objects will issue shares worth about $520 million and pay $300 million in cash.
More than 1,000 of Crystal's 1,700 employees are located in Vancouver, British Columbia. The company employs 25 at its Palo Alto legal headquarters. Business Objects employs 400 in the Bay Area. Most of its employees remain in Paris, where the company was founded.
