United States software firm Cornerstone OnDemand is understood to have agreed to pay about US$14 million to acquire 32-person software firm Sonar6, whose investors include Trade Me founder Sam Morgan.
Both companies sell "cloud-based" human resources systems that are designed to help companies review the performance of their staff.
Sonar6 chief executive Mike Carden said Cornerstone, which is valued at more than US$1 billion on the Nasdaq exchange, was probably the fastest-growing publicly-listed company in the US. It mainly supplied software used by big businesses with tens of thousands of employees, whereas Sonar6's focus was on smaller firms with fewer than 500 staff.The acquisition, which is due to be finalised next month, was a good one for staff, all of whom would keep their jobs, and for shareholders, who he said were very happy," he said.
"One of the great things is this business stays completely intact. We will still be headquartered here in Auckland and our US staff will continue to report into the organisation."
Commenting on the timing of the deal, Carden said there was a lot of market consolidation going on in the human resources software market. "In a situation like that you only really have two options; either to raise capital aggressively to compete in a market that has increased competition, or to look at acquisitions and if you are acquired you have the resources to grow faster. That is the option we ended up taking."
Sonar6 had grown as expected since it was founded six years' ago, he said. "There have been ups and downs in that time because of the global economy, but we have delivered the results we said we would deliver shareholders every year."
Source : stuff.co.nz
Tags : software,mergers, software buy out, new zealand software company,Sonar6, Cornerstone onDemand
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