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Golden Gate Capital, a San Francisco private equity firm, and Infor, a $2 billion private software company in Alpharetta, Ga., formed a holding company to buy SoftBrands for 92 cents per share. The deal represents a near doubling of the 47-cent closing price of the company's stock Thursday. Golden Gate Capital is Infor's majority investor, SoftBrands spokeswoman Susan Eich said.
"Size and scale matter in a consolidating software marketplace," SoftBrands CEO Randy Tofteland said in a conference call about the deal. He said SoftBrands wasn't big enough to compete profitably.
Founded in 2001, SoftBrands reported revenue of $98.7 million last year, and losses for the last three years, although losses had narrowed to $538,000 last year.
SoftBrands employs 740 worldwide, including 100 in Minneapolis. The company got its start in 1984 as Fourth Shift Corp., and Fourth Shift software now is used by mid-sized manufacturers to manage such things as supply chains and marketing. Softbrands first traded as an over-the-counter stock and moved to the American Stock Exchange in December 2005. The company acquired Hotel Information Systems in 2006, offering software that is used by the hotel industry to track reservations and manage
properties.
The company, headquartered on LaSalle Avenue in downtown Minneapolis, anticipates there may be some layoffs because of redundant positions, but it is too early to say how many, according to Eich.
"We will continue to be a presence in Minneapolis," she said.
SoftBrand's board has unanimously approved the deal and will recommend SoftBrands' stockholders approve the transaction, the company said in a statement. Pending regulatory and stockholder approval, the deal is expected to close in 60 to 90 days.
Leslie Brooks Suzukamo can be reached at 651-228-5475.
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