Adds sell- and buy-side e-commerce solutions; "good move" for both companies, analysts say
Chicago — June 19, 2003 — Software company SSA Global Technologies has acquired Ironside Technologies, a provider of e-commerce systems for manufacturing and distribution companies, in a deal that at least one analyst views as a good move for both companies.
The deal, for an undisclosed sum, follows closely on the recent acquisition of mid-market enterprise resource planning (ERP) provider Baan by an investment group with plans to merge Baan with SSA GT. (See related story.)
SSA GT said in a statement that Ironside's sell-side and buy-side e-commerce solutions would extend and strengthen SSA GT's existing product portfolio and become important components of its customer relationship and supplier relationship strategies.
In addition, the company cited common customers and complementary industry experience and technology platforms. The two providers' shared customers have included Tyco Plastics & Adhesives, Mother Parkers Tea & Coffee and ESAB Cutting and Welding. The providers both target mid-market manufacturers and distributors, and both run on the IBM iSeries, as well as Windows NT and UNIX.
"Our customers have told us that to remain competitive, they need comprehensive e-business solutions that are easily implemented, drive more sales and cut costs," said Mike Greenough, president, chairman and CEO of SSA GT. "The acquisition of Ironside supports our continued focus on offering products that deliver incremental value to our customers' existing enterprise systems."
Ironside solutions enable manufacturers and distributors to more effectively transact with customers and suppliers by automating such key processes as order management, supplier management, customer service and procurement. Ironside said its customers have netted a 50 percent reduction in transaction costs, 87 percent increase in order size and a 20 percent decrease in returned goods, with average order fulfillment time reduced from 24 hours to less than one hour.
The combination of the two companies makes sense to Nigel Montgomery and Louis Columbus, analysts with technology consultancy AMR Research. "SSA GT's BPCS ERP application needs a service-oriented infrastructure that can scale outside an enterprise and provide customers with order capture and management applications throughout their distribution channels," the analysts wrote Wednesday in a research alert. "That's exactly where Ironside's core strength is."
In addition, Ironside's recent investments in procurement and supplier enablement will be complementary to SSA GT's iProcurement application framework, Montgomery and Columbus suggested. "In many respects, this acquisition gives Ironside the opportunity to keep moving on its initiatives as part of an ERP vendor, which is precisely the consolidation direction channel management is heading today," they wrote.
In its statement, SSA GT noted its plan to improve its product offerings through a series of strategic acquisitions that have provided extensions to the core product line, and the company asserted that its customers are realizing incremental value from implementing acquired product extensions.
Indeed, the AMR analysts concluded that the Ironside acquisition shows "that SSA GT is not simply an ERP retirement home.... SSA GT is on track to become a strong force in the ERP replacement market, especially for mid-market companies requiring evolution rather than the revolution needed to move to companies such as SAP or Oracle."