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September 28, 1998

BEA TO SPEND $192M ON APP SERVER HOUSE WEBLOGIC

By CBR Staff Writer

In the latest of its slightly mystifying strategic plays, BEA Systems Inc, the acquisition king of middleware, has signed a definitive agreement to acquire Java pioneer WebLogic Inc, in a deal valued at around $192m. By adding WebLogic’s Java- and web-based rapid application development environment to its existing Tuxedo and Top End product lines, BEA says it wants to redefine the application server market. Buying web application server companies is a popular trend these days, as Netscape’s Kiva acquisition (CI No 3,297) and Sun’s NetDynamics purchase (CI No 3,444) can attest. WebLogic was founded in 1995 and has its headquarters in San Francisco. Its 94 employees serve 800 customers. The company will form the core of a new division of BEA, to be called BEA WebXpress. BEA’s chief technology officer Alfred Chuang will assume the role of general manager of the division. It’s expected that WebXpress will provide an extra sales channel for BEA, with its team pushing WebLogic products as entry points to BEA’s middleware. In acquiring WebLogic, BEA notes that it has also extended its support for Enterprise Java Beans (EJB) and Microsoft’s COM. BEA will trade 7.7m shares of its stock and issue an additional 1.8m shares to WebLogic employees to cover the company’s stock-option plan. If WebLogic’s shareholders approve, the transaction should close by September 30.

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