Dataworks next in Platinum gold rush

Software vendor continues acquisition spree in $93m stock swap.

Acquisitive manufacturer Platinum Software has hit the shopping trail again after buying enterprise resource planning (ERP) supplier Dataworks in a $93 million stock swap.

Platinum focuses on front-office applications, while Dataworks operates in the manufacturing area. George Klaus, chief executive and chairman of Platinum, said the deal represented 'a chance to combine forces with another successful team attacking the ERP market'.

Stuart Clifton, chief executive and president of Dataworks, will assume the role of vice chairman after the company is subsumed by Platinum. He said: 'We share similar business models and Microsoft-based technologies targeted at the rapidly growing mid-market - companies with up to $500 million in revenue.

'Because there is virtually no overlap within our respective customer bases, we believe significant revenue opportunities exist for the combined company.'

Platinum confirmed that there would be office closures, but the company refused to release any details.

Over the past year, the Platinum share price has reached a high and low of $27.25 and $6 respectively. Stock experienced an unexplained decline last month, falling by 37 per cent.

Over the past few years, Platinum has snapped up companies, including purchases such as SII, Answer, Locus, Altai, Trinzic, Softool, Prodea, Paradigm, Axis, ATR, I&S, Mastering, Learmonth & Burchett Management Systems and Logic Works. They were all accounted as mergers, but other buys, almost as many again, were accounted as straightforward purchases.

Platinum's 1998 revenue was $98.5 million compared with $60.8 million for 1997. It reported a net profit of $13.3 million, compared with a loss of $4.4 million for 1997 and losses in the previous two years.