Managing Automation - August 2008 - (Page 11)

Quote of the ware and service businesses requiring specific operational expertise or [that] are ready for consolidation,” according to a company statement. Backer Accel-KKR, which was created in 2000 as a joint venture of equity investors Accel and KKR, defines its investment sweet spot as companies with $15 million to $150 million in revenue. Neither company would disclose the monetary value of Accel-KKR’s M2 sponsorship. Ray Wang, an analyst with Forrester Research, said Duffell’s and Piraino’s tenure at Epicor, during which they presided over a slew of acquisitions, should put M2 on solid footing. Duffell left Epicor in March after 12 years with the company. Piraino, who joined the company as CFO in 2003, left in May. “They have done some tremendous work in acquisitions and integration, so there’s a lot of good experience there,” Wang said. Ray Wang He also gave M2 high marks for targeting acquisitions in the sub-$250 million market. “If that’s what they’re trying to tackle, there’s some really good opportunities there.” Those opportunities could well be companies with products built on the .NET platform, Wang said, noting that Epicor delivered software based on that technology. He also predicted that M2 may pursue software vendors with vertical-industry specialization and strong license-to-maintenance revenue ratios. “What everyone is looking at is recurring revenue streams because that really helps you pay for the next set of acquisitions,” Wang said. He noted the success of companies dedicated to this model, including Infor, CA, and Oracle. Commenting recently on the prospects for M&A activity in the software market, AMR Research Chief Research Officer Bruce Richardson said that although many possible targets have already been acquired in markets such as business intelligence, “two sectors offer large customer bases and relatively good growth prospects: supply chain management (SCM) and human capital management (HCM).” In that same June research entry, Richardson said, “While the private equity firms may be a little gun-shy about the software market, we could see several buying vendors on which to build a platform.” — Chris Chiappinelli MONTH A SOFTWARE SUITE JUST FOR MANUFACTURERS “Having [an additional] $83 million in cash on our balance sheet is huge.” — CEO Pallab Chatterjee said in reference to i2’s receipt of $83 million to settle its patent suit against SAP O n-demand business management software provider NetSuite Inc. has brought out a suite of products tailored to manufacturing companies. NetSuite for Manufacturers includes functionality for assembly, work order, bill of materials, and inventory applications, the company said. The suite is intended to take direct aim at mid-sized manufacturers that otherwise might be inclined to buy SAP’s on-demand Business ByDesign product, which SAP announced in September 2007 but has yet to roll out. The new release builds on the core functionality contained in NetSuite’s Wholesale/Distribution Edition, adding manufacturing-specific modules, most notably Work Orders, said Malin Huffman, senior product manager at NetSuite. With the module, manufacturers “can not only track item sales, but demand for those items,” Huffman said. “NetSuite has been offering vertical suites for the wholesale/distribution industry for a while with a proven track record,” said Bruce Richardson, AMR Research’s chief research officer, in a statement. “Until this release from NetSuite, there haven’t been any broad SaaS product offerings that include financials, CRM, e-commerce, and manufacturing.” NetSuite for Manufacturers is intended for use by companies in light manufacturing industries, many of which already are users of the NetSuite Wholesale/Distribution Edition. “Over the past several years, in working with our wholesale and distribution customers, we realized many are also light manufacturers who make some or all of their products with fairly straightforward processes,” Huffman said. The new functionality in NetSuite for Manufacturers includes Assembly Management, which adds assembly items specifically for light manufacturers; Work Orders, with which light manufacturers can readily manage the build process of replenishing standing inventory levels of finished goods or special order work orders; Bill of Materials (BOM), which covers the components required for a single assembly plus all the components required by a particular work order; and Demand-Based Inventory Replenishment, used to dynamically reorder points and preferred stock levels for components of assemblies as well as finished goods. “NetSuite enables manufacturers to automate complex business processes without the cost and For the Continued from page 8 Record M&AS Voltran WEG, a power transformer manufacturer in Latin America and Mexico, will implement Solid Edge and Teamcenter software from Siemens PLM Software. Zyvax, Inc., a maker of release coatings and mold release products, licensed the DEACOM Integrated Accounting and ERP Software System. Industrial Defender, Inc., a cyber-risk protection company, acquired Teltone Corp., maker of the Gauntlet secure substation communications product. PLM provider Dassault Systèmes agreed to purchase Engineous Software, which specializes in process automation, integration, and optimization. CDC Software acquired Dynamic Business Consultants, a software systems integrator in Melbourne, Australia. FINANCIALS Boomi, a provider of on-demand integration for SaaS and on-premise applications, raised $4 million from FirstMark Capital in its first institutional round of financing. MDM solutions provider Initiate Systems, Inc. completed a $26 million round of financing, led by Paladin Capital Group. L Capital Partners, L.P. invested $4 million in Simparel, which offers ERP and SaaS products. TIBCO Software Inc.’s revenue rose 15% to $150.0 million in the second quarter while net income fell to $3.5 million. PA R T N E R S H I P S Infor is collaborating with IBM Global Financing on a customer financing program. JDA Software Group Inc. is working with consulting company Oliver Wight on next-generation S&OP products. Lowry Computer Products teamed up with OATSystems on turnkey RFID asset tracking and work-in-process products. Solarsoft Business Solutions is partnering with MIC Business Solutions, Inc., a Mitsubishi International Corp. unit, to resell Solarsoft’s ERP systems to Japanese-owned manufacturers in North America. 11 August 2008

Table of Contents Feed for the Digital Edition of Managing Automation - August 2008

Managing Automation - August 2008 Contents Take 1 After 18 Months, the Oracle/SAP Suit Has Little Effect on Maintenance Sales At 100, Foxboro Reinvents Around Its Customers New Private Equity Firm Eyes Software A Software Suite Just for Manufacturers i2 Chief Focuses on Services Plan Notes It's Time for Action Examining U.S. Competitveness Leveling the Field An Unhealthy Situation Exploring Alternatives Math and Science: Key to the Future Product Scan Advertiser Index Next

Managing Automation - August 2008

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