28 May 2002 Accounting software vendor Sage has called for the $1.3 billion (€1.4bn) acquisition of rival Navision by software giant Microsoft to be blocked. It is appealing to European governments and the European Union to stop the move on anti-competitive grounds.
Proceedings will start in Denmark, where Navision is based. Sage lawyers met with officials at Denmark’s Competition Agency today, while talks at the European Commission are set to take place tomorrow. Sage argues that the deal will put Microsoft in a dominant position in the European market for software for the small and medium-size business (SMB) sector.
The Newcastle, UK-based company fears that a combined Microsoft-Navision will be able to lock-out competition in the Danish market by bundling Navision’s software with its other software suites and by slashing prices.
The software giant will also pressure other players into using Navision software, claims Sage chief operating officer Paul Stobart. “That happened in the US after Microsoft acquired … Great Plains. We know that this will now happen in Europe. That’s why we are going to the authorities … Our legal advisors say we have a good case,” Stobart told Danish business newspaper Boersen.
Many analysts doubt that Sage will be able to stop the takeover, but reckon that its complaint will slow down the acquisition and may lead to various concessions being extracted from Microsoft in the process.