Texas Instruments Inc’s TI Software, originally conceived to turn software the company had developed for in-house use into products that could be marketed to others, has long looked very surplus to the chip and defense electronics company’s requirements, so it comes as little surprise that Texas is offloading what must be a significant cash drain onto Sterling Software Inc for $165m cash. That buys a company whose 1996 revenue was around $250m in 1996 and has the Composer and Arranger development tools as the star names in its portfolio. The repository that TI had been developing with Microsoft Corp turned out to be the dampest of damp squibs and now Microsoft is rumored to be off playing ball with another repository shop. The deal greatly increases the size of Dallas-based Sterling Software, which had sales of $440m for the year to September – although it is not clear how much growth there is in the Texas products. The $165m buys all TI Software assets, including the stock of some European subsidiaries, and also assumption of various liabilities related to the business. Sterling expects to merge the acquisition with its existing $100m-a-year applications development business on completion. Based in the Plano suburb of Dallas, Texas Instruments Software says it has over 1,300 employees and a distribution infrastructure that supports 30 countries throughout North America, Europe, Asia, Latin America and Africa. Sterling says it will upgrade its Key:Enterprise workflow and business process reengineering applications with the TI software which will strengthen its portfolio against competitors such as Computer Associates Inc and Platinum Technology Inc. Texas Instruments has sold off close to $3bn business since the beginning of 1996 in its attempt to re-focus of its core semiconductor operations. Wall Street didn’t make much of the announcement, pushing Sterling shares up $0.75 to $29.12 on the day – while Texas Instruments closed up $1.00 at $82.87.
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