COBOL solutions ownership, and potential product design direction, changed on Friday when Micro Focus announced it has acquired development and COBOL supplier Acucorp for $40.7 million and an acquired cash consideration of no more than $250,000.
The two companies have battled for business in the HP 3000 migration marketplace. While Acucorp designed and released a 3000-compatible compiler in 2001 — only to see, within months of release, HP announce a 2006 exit from the 3000 marketplace — Micro Focus has worked from a broader base of enterprise environments. HP 3000 customers and application suppliers, including Amisys and others, have chosen the Micro Focus solution when moving away from the HP 3000.
Neither company made headway into selling a solution for homesteading 3000 sites: Acucorp because of HP's withdrawal from the 3000 market, and Micro Focus because the company has never offered an MPE/iX solution.
Acucorp generated $3 million in profit in its just-ended fiscal year, according to MicroFocus. The company will be restructured by 2008 "to margins... consistent with Micro Focus' existing business."
Acucorp's gross assets at the end of 2006 were 13.1 million. Micro Focus will take an $8 million restructuring charge, by April of 2008, to bring the Acucorp business into the Micro Focus operations.
Micro Focus, the larger of the two suppliers, issued a press release on Friday reporting the company's year-end results along with the purchase details. Micro Focus a public corporation, while Acucorp is not.
The release on the Acucorp Web site assures the Acucorp customers — the majority of whom have little to do with the 3000 market — that the merger will bring benefits to them:
Micro Focus remains committed to delivering the highest level of support and business value to Acucorp customers. Specifically for Acucorp customers, the combination of the two companies will bring further improvement in support and maintenance capabilities. The company believes the future will provide broader development capacity to accelerate innovation to meet customers’ current and future demands.
Micro Focus CEO Stephen Kelly, who's brought a new management team on board in the past year, had more detailed comments on the purchase.
Kelly, who has been focused on increasing Micro Focus revenues as well as profits, in part through pursuit of "legacy customers" said
The acquisition of Acucorp is consistent with Micro Focus' strategy of expanding our core areas of expertise. We anticipate that the acquisition of Acucorp will contribute revenues of approximately $17m in FY2008."
MicroFocus had just acquired HAL Knowledge Solutions in November of 2006. A Micro Focus release reports the company posted $170 million in revenues for its fiscal year just ended on April 30. Preliminary numbers on profits, before accounting depreciations and taxes, were $65 million.