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November 27, 1995

ADOBE, RUNNING OUT OF TAKEOVER CANDIDATES, SAYS FRAME TECHNOLOGY WILL BE THE LAST FOR TIME BEING

By CBR Staff Writer

Adobe Systems Inc, Mountain View, California has now completed its $460m acquisition of document imaging software maker Frame Technology Inc and that it is running out of new takeover candidates for the time being, president Charles Geschke told Reuters. Geschke predicted few, if any, problems in meshing the companies’ engineering and sales groups. But he said that the companies will cut their combined worldwide staff by 150 people, or 7%. Adobe will take a related charge in the fourth quarter to November 30, but Geschke said the size was still being worked out. He declined to give an estimate. The acquisition of San Jose, California-based Frame, which sells desktop publishing software to the Unix market, follows Adobe’s $525m purchase of Aldus Corp last September. Adobe stock gained $3.75 to $58 on the news. In terms of large software companies, there aren’t a lot left to look at, so we’re probably not going to be pushing for a major acquisition at this point, Adobe president Chuck Geschke told the news service. Adobe also tidied up its corporate structure, handing the chief operating officer position held by president Geschke to the two senior vice-presidents, Stephen MacDonald and David Pratt, who were handling its functions. Before the deal with Frame, Adobe had started to put together an Internet bundle for the Unix-based operating system, consisting of desktop publishing programs FrameMaker, Illustrator and PhotoShop. The acquisition will enable Adobe to sell its publishing software to the Unix market, the computer system on which many firms run their main operations. Conversely, Adobe is looking to sell Frame products to the personal computer market. Geschke said Adobe could do a much better job for Frame in expanding the market for Frame in the personal computer and Macintosh channels. It turns out that there’s essentially no customer overlap between (Adobe’s) PageMaker and (Frame’s) FrameMaker, so we think there’s a good opportunity for some upside, he declared.

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