Sage Group PLC to purchase Best Software, Inc. for 4.52 times revenue, The

Weekly Corporate Growth Report, Jan 24, 2000

The Deal: British supplier of accounting software, the Sage Group PLC, has announced that it would purchase Best Software, Inc. for $413 million in cash, or $35 per share. After the news of the acquisition was announced, Best Software shares rose $4.5625 a share, to close at $34.50. The Sage Group has for some time been an active reseller of Best Software's payroll and fixed-asset software.

Discussion: Best Software provides software for managing assets, human resources and payroll. The company's scaleable products include the FAS asset management line (53% sales), which calculates depreciation and produces tax reports and forms, and the Abra human resources and payroll management line (38% sales), which processes payroll and conducts employee cost and productivity analysis. Best Internet Recruiter software lists jobs online and links them to employment Web sites. The company also provides maintenance, support, training and consulting services that include implementation, system setup and data conversion.

The Sage Group PLC is the largest global provider of PC accounting software. The company continues to expand its product lines for small businesses through an aggressive international acquisition strategy. Its subsidiaries in France, Germany, the U.K. and the U.S. develop separate software programs geared toward the specific accounting laws of the particular country they're in. The Sage Group, which distributes its products through resellers, relies on repeat business in the form of upgrades, maintenance and other services for most of its sales.