After a short holiday from the phenomenal buying spree which transformed it into a mainstream software infrastructure company from a systems and data management player, Platinum Technology Inc is buying again, this time taking over Learmonth & Burchett Management Systems Inc and its process management products. Platinum will add LBMS’ Process Engineer process management products to its own Process Continuum suite, itself a component of Platinum’s Advantage integrated rapid application development suite. The purchase also brings 30,000 worldwide LBMS users to Platinum, which will pay approximately $70m in stock for the Houston, Texas-based spin-off of what was once UK-based Learmonth & Burchett Management Systems Plc. LBMS has been struggling of late, posting huge losses earlier in the year of $16.3m up from losses of just $0.8m the previous year, on revenue down 47% to $21.9m (CI No 3,137). The companies say their two products were on the same development path, and it made sense to combine them. Platinum, which in the 30 months to April this year had made 61 acquisitions and taken its revenue to nearly $600m from $96m in 1994, put the brakes on the acquisition strategy to enable it to consolidate and focus on its elusive goal of profitability (CI No 3,267). An undisclosed equity investment from Intel Corp announced just a few days ago, which includes a joint development, marketing and cross-licensing agreement between the two firms (CI No 3,317), has presumably set Platinum firmly back on its feet again. The LBMS acquisition is expected to be completed by the middle of next year and should be accounted for as a pooling of interests.
