Adobe Systems Inc is king of the heap when it comes to desktop publishing, but it wants to broaden its reach and embrace the high end of the market, where simple text design and layout gives way to complex documents that include rarefied engineering drawings and impenetrable equations. That is the world in which Frame Technology Inc makes its home, and so Adobe has persuaded the San Jose company to recommend a $500m share exchange takeover by Adobe to its shareholders. Adobe chief executive John Warnock said during a conference call that 70% of Frame Technology’s business is selling into the Unix market, where Adobe products have very little presence. That indicates to us there should be quite an expansion, of market opportunity Adobe will acquire with Frame. Adobe is also looking to Frame to expand its Internet-related business further. Warnock said Adobe’s overall goal in this as well as previous acquisitions is to provide everything you need to author or create information, to access it, distribute it and process it. The missing link is a stronger multimedia offering but he declined to say whether Adobe was now in the market for a multimedia acquisition. While Adobe’s Acrobat software for the original creation of Web Pages, the pages are distributed a Unix server, and with Frame, Adobe reckons it can get more in the market of distributing Web Page information within and from corporations. Adobe, Mountain View, says acquisition of Frame will create a company currentlt running at $725m a year. Frame will be subsumed into Adobe, not run as a separate company. The terms call for Adobe to pay 0.52 shares for each Frame, currently worth $34 a share, compared with a close of $26.75 immediately before the announcement. Frame Technology looked as if it was dying in 1993, but a fierce restructuring and new management got it back to profit of $9.7m on sales of $72.4m last year. Adobe reached the critical mass that now enables it to throw its weight about when it took over Aldus Corp last year.
