Pervasive Software Inc., a leading provider of data management solutions powering the success of application developers worldwide, announced it has signed a definitive agreement to acquire privately held Data Junction Corporation, a pioneering data and application integration company based in Austin, Texas, for $22.1 million in cash and 5 million shares of Pervasive common stock. The transaction is valued at a total of approximately $51.7 million, based upon Pervasive’s closing price per share of $5.91 on August 8, 2003. The agreement has been unanimously approved by the boards of directors of Pervasive and Data Junction and is subject to the approval of the shareholders of both companies. The acquisition is expected to be immediately accretive, on a pro forma basis before purchase accounting adjustments or other transaction-related expenses, and is expected to close in the fourth calendar quarter of 2003.
Data Junction will bring important data integration and transformation technologies and products, which are highly complementary to Pervasive’s existing data management products, expertise and customer base. The acquisition of Data Junction will significantly advance Pervasive’s strategy to provide a family of solutions that deliver the industry’s best combination of performance, reliability and low total cost of ownership, resulting in a pure play data management infrastructure software company.
Data Junction, founded in 1984, has operated profitably since 1990. The company is growing rapidly with approximately $14 million in annual revenue for its recently completed fiscal year 2003, up from $9.7 million in fiscal year 2002. Winner of more than 20 major industry awards, Data Junction is a market leader in innovative integration technology with more than 25,000 customers, including major consulting firms and software vendors who embed the technology into their applications. Customers include systems integrator EDS; independent software vendor Cardiff Software, Inc.; and a wide range of end- users such as Automatic Data Processing, Inc., J.P. Morgan Chase & Co. and WebMD Corporation, who connect or help their customers connect disparate data sources to extend the value of their data.
Data Junction’s primary products include the Data Junction Integration Studio, which is a comprehensive set of visual design tools for rapidly building and testing data integration processes that work with hundreds of data formats and applications. This enables design with total control over all aspects of the integration project from creating integration maps to managing complex, event-driven flow of inter-application messages and EDI processes. Data Junction virtually created the category known as ETL (extract, transform and load) in 1986 with Data Junction v1.0, one of the world’s first hub-and-spoke approaches to data conversion and translation, and today is charting new ground in the development of business and application integration technologies.
Pervasive’s systematic approach to expanding its family of data management products involves identifying and validating complementary market segments for growth around its core database business. Those market segments include data replication, data security, business intelligence, and data and application integration. Through internal development and technology licenses and acquisitions, the company is now delivering, or will soon be bringing to market, products that represent each of these areas.
Following the completion of the acquisition, Pervasive will continue to focus on providing data management solutions that deliver the industry’s best combination of performance, reliability and low total cost of ownership. The combined company will serve more than 35,000 customers in 150 countries. Data Junction President Michael Hoskins will join the Pervasive management team to lead a business unit focusing on data and application integration solutions. This new business unit will operate alongside Pervasive’s core Pervasive.SQL database business unit, which also includes Pervasive DataExchange (data replication technology) and Pervasive AuditMaster (transaction intelligence and data monitoring software). Hoskins also will be nominated for election to the Pervasive board of directors.
Pervasive will acquire Data Junction pursuant to a merger with and into a wholly owned subsidiary of Pervasive. After the merger, the wholly owned subsidiary will survive and all issued and outstanding shares of capital stock of Data Junction will be exchanged for an aggregate of $22.1 million in cash and 5 million shares of Pervasive common stock. Pervasive will assume Data junction’s cash balances in the transaction, totaling $6.5 million as of June 30, 2003, and will continue to have significant cash resources following completion of the transaction in the December quarter with a combined post- closing cash balance expected to exceed $24 million. The proposed merger is expected to be a tax-free reorganization.
The completion of the acquisition is conditioned upon, among other things, the expiration or termination of the waiting period under the Hart-Scott- Rodino Anti-Trust Improvements Act of 1976, approval from shareholders of Pervasive and Data Junction, listing of the shares of Pervasive common stock to be issued to shareholders of Data Junction on the Nasdaq Stock Market and other customary closing conditions. Shareholder votes are expected to take place at the two companies' respective stockholder meetings to be held in the fall.
Pervasive has received voting commitments in support of the proposed acquisition from the four largest Data Junction stockholders, amounting to a total of approximately 90 percent of Data Junction’s outstanding common stock.
Register or login for access to this item and much more
All Information Management content is archived after seven days.
Community members receive:
- All recent and archived articles
- Conference offers and updates
- A full menu of enewsletter options
- Web seminars, white papers, ebooks
Already have an account? Log In
Don't have an account? Register for Free Unlimited Access