Best Software, Inc., the U.S. entity of UK-based The Sage Group plc, has agreed to acquire Accpac International, Inc. from Computer Associates International, Inc., for US$110 million in cash.
Accpac, which was originally founded in Vancouver, B.C., and now based in Pleasanton, Calif., will
enable Best to finally enter the Canadian market place, according to Ron Verni, CEO of Best, based in Irvine, Calif.
“(Accpac’s) Canadian operation is a presence we do not have and the beauty is there is very little overlap. We are looking to add the depth and breadth of Accpac’s knowledge in Canada and their market leadership,” Verni said.
Best does have a small development and sales office in Canada and the company acquired Softline, which has BusinessVision based in Mississauga, Ont.
With Accpac under the Best umbrella, the combine companies now have a powerhouse channel of close to 14,000 SMB focused resellers in North America.
This deal Verni said positions Best/Accpac better against rival Microsoft.
“The key thing is it will give customers a choice and they (Microsoft) do not get that. They get A choice,” Verni said.
Currently the Accpac/Best product line can run under Linux, DB2 and Windows.
Another key to the deal was Accpac hosted CRM solution, an option Verni admitted Best does not have and needs to build to remain competitive.
Long-time Accpac dealer Mike Burch, president of BurCom Consulting Ltd. of Edmonton is also very bullish on the deal. However, he believes this deal is like David acquiring Goliath.
Burch said that Accpac products are more Canadianized and far superior to Best’s core accounting products.
“Best did not have a product that satisfied core accounting in Canada and internationally,” Burch said.
Burch was approached by Best, about 18 months ago, to become a Best dealer. “Best is aggressive. This will give them a good foothold in Canada.”
He added that for the channel the deal is also positive because Sage is in tune with the SMB market, while Accpac’s parent company, Computer Associates, isn’t.
Accpac CEO David Hood, wanted to make the best deal possible for Accpac employees, partners and customers. CA has made no secret it wanted to shed some assets and tried unsuccessfully to spin off Accpac with an IPO back in 2002.
“Breaking away from CA was the best path,” Hood said. “It is all about timing. If you asked me in 2000 (if this deal was preferable to the IPO path that Accpac was on) I’d have said I do not want to do this deal, but we need to provide maximum shareholder value and we did this in this case. Was I influenced by CA? Yes! But, the strategy we were on I would not categorize it as one where I would not do the deal. It is a good solid opportunity for the employees and partners, and Accpac is inside a company with the right SMB market strategy.”
Hood’s position in the new company has not been finalized.
Burch would like to see Hood stay on board. “Hood had vision. He gave us direction and understanding,” he said.
The acquisition is subject to regulatory approvals and is expected to be completed by the end of February.