Pleasanton, CA May 3, 2001 -- PeopleSoft today announced a definitive agreement to acquire the Sunnyvale, Calif.-based SkillsVillage in a $32 million stock and cash deal. According to the terms of the agreement, SkillsVillage will be re-branded under the PeopleSoft name, but will still be independently sellable. The acquisition is scheduled to close on May 31, 2001.
By acquiring the services procurement provider, PeopleSoft is strategically increasing its placement in the workforce management market, a market that has been largely ignored in favor of the MRO and OEM procurement sector. But now, PeopleSoft appears to have a solid footing as the forerunner in this sector.
"The corporate spend on services is one of the largest expense line items in enterprises today," said PeopleSoft President and CEO Craig Conway. "The financial benefits of automating services far outweigh the benefits derived from automating other types of procurement such as Maintenance, Repair and Operation (MRO)."
Another factor contributing to the acquisition of SkillsVillage was PeopleSoft's healthy financial situation of late. After a rough February, PeopleSoft's stock made a strong rebound in March and April, helping it to beat its first quarter earnings expectations. Bottom line: PeopleSoft is experiencing some good financial times right now, and the acquisition showcases its ability to spend some extra cash.
"PeopleSoft again has seized an opportunity to set a trend in the industry," said Bruce Richardson, senior vice president, AMR. "They recognize the business imperative today for companies to improve profits, increase efficiencies and reduce costs. Acquiring SkillsVillage vaults PeopleSoft into the leading position in the very lucrative services automation market while other MRO vendors are struggling to survive."
