23 January 2004 Content management specialist Vignette has acquired Australian document management software supplier Tower Technology in a $125 million deal.

The deal will enable Vignette to offer the full range of content and records management products, pitting it against high-end document management software suppliers such as Filenet, OpenText and Documentum, as well as mid-tier vendors such as Stellent and Interwoven.

Vignette CEO Thomas Hogan said that the acquisition, combined with past purchases, will help transform the company “into the industry’s only combined suite of enterprise content management services and the highly complementary deliver services associated with our portal, integration and collaboration applications,” said Hogan.

Furthermore, the acquisition will boost Vignette’s presence outside the US. Tower derives half its revenues from Europe, with the majority of its customers based in the UK. These include outsourcer Capita, the Department of Trade and Industry and Yorkshire Water.

The deal is the latest in a string of purchases by Vignette, which includes its $32 million acquisitions of portal software supplier Epicentric in October 2002, and a $20 million deal for collaborative workspace software vendor Intraspect in September 2003.

At the same time as the Epicentric deal, Vignette also acquired the intellectual property of once-hot e-marketing software supplier Revenio, which provided it with online customer interaction software.

“This marks the continuation of the rapid consolidation of the ECM market and lifts Vignette back into a contender position in the market,” said Ovum principal analyst Chris Harris-Jones. However, integrating Tower’s technology with Vignette’s may prove challenging he added.

Document and records management software has increased in importance since the WorldCom and Enron scandals — among others — put the spotlight on corporate governance. “[It} has become a requirement as government and commercial organisations focus on compliance and risk reduction,” said Meta Group senior vice president Andrew Warzecha.