Enterprise Software
How we helped a leading enterprise software provider strengthen its market position and attract strategic interest from the investment community.
Company Background
The “Company” was a provider of business process automation and application integration solutions, with a substantial customer base in the government, telecommunications and financial services market. The Company was generating approximately $43 million in revenue with net income margin of 5.65% and had less than 5 million shares outstanding.
Challenge
While the Company had grown over the previous years, growth had stalled and, due to its low share float, it received very little attention from the investment community. Management had determined that it needed to either merge or be acquired.
The project required:
Enhancement of the Company’s communications to boost its visibility to the investment community and attractiveness to potential merger candidates or acquirers.
Contributions
- Met with divisional managers to assist the Company in determining its strategic direction in light of industry developments and existing capital resources.
- Produced peer group analysis, comparing the Company’s metrics to similar companies.
- Created performance indicators that highlight the Company’s investment merits to attract potential merger candidates.
- Developed a communication strategy that displayed the Company’s accomplishments and potential.
- Assisted the CEO in establishing a coordinated strategic direction and business plan for the Company.
- Assisted the Company’s communications and public relations staff to organize an exposure campaign that highlighted the Company’s:
– Investment merits
– Potential growth through industry dynamics
– Relative value compared to peer group participants - Assisted the Company in hiring a qualified CFO and worked with him to produce more comprehensible quarterly and annual SEC reports.
Conclusion
The objective of enhancing the Company’s public visibility was successful. The Company, which was trading between $3 and $4 per share, attracted the attention of and was acquired by a larger applications integration solutions company at a value of $8 per share. The acquiring company then continued our advisory engagement.
Joe Zappulla: jzappulla@dutchesscapital.com