ERP Software

Sage want to join the acquisition race

Interesting article from the times online broker team they are pushing SAGE as a great stock to purchase for a potential takeover.

The reason they have got so excited is Sage has always had the reputation of a minor player within the back office vendor market now that Sage has bought Verus the brokers are hoping the stock will be revalued higher.

Sage must be extremely irritated that they did not get into the Gartner report that said only SAP, Oracle, Microsoft and SSA will be the main players in the ERP Market in a few years time. Sage has indicated that they want to increase their net debt from £100 million to £600 million might need a couple hundred million more to play with the big guys considering Microsoft is spending two billion dollars on R&D alone.

Sage buys Verus

Sage group has bought Verus Financial Management for 184 million pounds

Verus is a merchant services business specialising in credit card and cheque processing for small and medium-sized businesses ('SMEs') based in the US they have 101,000 small and medium-sized merchants in the
US, including speciality retailers, petrol stations, restaurants, property managers and motor dealerships. Verus revenues come from services fees linked to processed sales transactions.

Verus has grown organically by 29% last year a bit of player in their field. Verus services include point of sale transaction processing and customer validity checks. This process includes a validation on each transaction's risk so that individual sales can be queried if appearing unusual. To complete each transaction, Verus transfers cash directly from the card- or cheque-issuing bank to the merchant's bank. The merchant also receives statements and
analysis, which can be used as inputs to accounting software.

This will be a nice extension for sage and they must be keen to sell Sage as a back office replacement to Verus’s customer base.