UPDATE: Micro Focus, Borland Settle US Suit
20 July 2009 - 5:49PM
Dow Jones News
Micro Focus International PLC (MCRO.LN), which has proposed a
$113 million offer for Borland Software Corp. (BORL), Monday said
both companies had agreed to settle a class action lawsuit brought
against Borland in the U.S. to avoid delays in closing the
acquisition and costly legal bills.
Micro Focus said the settlement amount "is immaterial" and won't
affect the financial considerations of the merger, or the timing of
the companies' respective shareholder meetings to vote on it.
The settlement was for a class action lawsuit filed in Texas
against Borland, Micro Focus and others on the alleged grounds that
the proposed merger consideration and sale process was unfair, an
allegation that the two parties believe is "wholly without
mertit."
Micro Focus' general meeting to vote on the acquisition is set
for July 24, and that of Borland July 22.
The $1.50 a share bid for Borland, which is backed by the Micro
Focus and Borland boards, follows two previous, lower offers, after
alternative bidders emerged.
Once a software heavyweight and Microsoft Corp (MSFT) rival,
Borland's operating losses have grown over the last two years.
Micro Focus management said at the time of the acquisition
announcement in May it has a "clearly defined plan to address the
financial and operating performance of Borland, with a view to
repositioning the business to achieve acceptable returns on sales
and investment."
Micro Focus provides software that helps companies to manage and
modernize existing applications. The company in May bought
Compuware Corp.'s (CPWR) testing and automated software quality
business. Together with Borland, both acquisitions would give Micro
Focus a footprint in software testing which ensures that software
works properly when it is in development.
At 0709 GMT Monday, Micro Focus shares were down 1.2%, or 4p, to
351p, underperforming a 0.48% rise in the FTSE 250.
-By Adrian Kerr, Dow Jones Newswires; 44 (0) 207 842 9309;
adrian.kerr@dowjones.com
(Kathy Sandler contributed to this report)