Baan sold to investment group; to merge with SSA


3 June 2003 UK engineering company Invensys has finally sold ailing enterprise software company Baan to an investment consortium for $135 million.

Private equity firms General Atlantic Partners and Cerberus Capital Management will take full ownership of Baan, which has been up for sale since April. Over the next few months they plan to merge Baan with rival software supplier SSA Global Technologies — also owned by General Atlantic Partners.

Combined, Baan and SSA GT will have in excess of 16,500 customers and licence revenues of $160 million, according to Baan CEO Laurens van der Tang. Each product set will continue to be developed individually and continue to be sold under the Baan and SSA GT brands, he added. Any existing product development will continue.

The announcement comes hours after rival enterprise application supplier PeopleSoft revealed that it had agreed to acquire JD Edwards for $1.7 billion in stock. “We believe further consolidation in the enterprise software industry is inevitable,” said Van der Tang. “This gives is the opportunity to get a leadership role in that consolidated industry.”

Both companies derive more than 80% of their business from manufacturing customers, so there could be considerable customer overlap. However, Van der Tang was keen to point out that Baan has traditionally been stronger in Europe, while SSA GT has a larger installed base in the US.

Speculation surrounding who might buy Baan — which was originally sold to Invensys for $708 million in 2000 — has been mounting since Invensys announced it was for sale in April.

Van der Tang confirmed that other business applications companies had looked at buying the company, but Baan’s management team had concluded that the investment consortium of GAP and Cerberus, as well as merger with SSA, was the “best strategic offer”.

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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