Epicor Software Corporation (NASDAQ: EPIC), a leading provider of
enterprise business software solutions to the midmarket and Global
1000 companies, today announced it has agreed to acquire privately
held SPECTRUM Human Resource Systems Corporation based in Denver,
Colorado for approximately $16 million in cash, subject to certain
closing adjustments. The acquisition is expected to close by
December 31, 2010.
With approximately 100 employees, over 430 direct customers (an
additional 1,800 through OEM relationships), and projected
full-year 2010 revenues of approximately $14 million, Spectrum's
best-in-class Web-based human resource and talent management
solutions will be the core of the newly formed Epicor Human Capital
Management (HCM) group. The acquisition broadens Epicor's position
as a leading provider of complete end-to-end enterprise business
solutions to the manufacturing, distribution, retail, hospitality
and services sector, with the addition of end-to-end HRMS. Epicor
does not expect the acquisition to have a material impact on its
2010 financial results, but does expect it to be slightly accretive
to revenue and earnings beginning the first quarter of 2011.
"Spectrum is perfectly aligned with our strategy to provide
comprehensive solutions and services that offer businesses both
choice and flexibility; delivered on-premise, as a managed service,
or in the cloud," said George Klaus, chairman, president and CEO of
Epicor. "The acquisition is an excellent fit from a technology,
corporate culture, and customer service standpoint -- both
companies leverage the Microsoft .NET Framework, have a
customer-centric focus, and deliver service from a single-point of
accountability.
"The opportunity to deliver this comprehensive best-in-class
HRMS creates new market opportunities both domestically and
internationally. The complementary technology focus along with our
commitment to service-oriented architecture (SOA) will allow us to
quickly integrate the product across many of our product lines
particularly Epicor 9, which will create significant cross-selling
opportunities to both our ERP and HCM customers."
Global HCM Market Opportunity in the Cloud
According to a recent report by Gartner, Inc., "The application and
delivery model portfolio needs to be actively managed to enable HR
organizations to align their initiatives with business objectives.
Poor decisions can lead to increased operating costs jeopardizing
opportunities to improve service models and strategic capability.
CIOs should include HCM applications in their service-oriented
architecture (SOA) plans, and HCM technology governance plans must
address growing SaaS use."(1)
In the same report Gartner states, "HCM applications are
fundamental to an organization's business application strategy.
Consequently, the evaluation, selection and implementation of the
applications will have a major impact on overall business
application strategy. Gartner is estimating approximately $6
billion in revenue in the HCM software market in 2010, and expects
4.5% growth during the next three years."(1)
With combined focus on Microsoft .NET, Web 2.0 and cloud
computing technologies, and expertise in delivering world-class
business solutions, Epicor and Spectrum together can deliver a
solution that requires no compromises and what no other company is
providing today -- an end-to-end HCM solution backed by local
country support, localization and language, and supporting flexible
delivery options including SaaS, hosted, and on-premise.
"We are excited to join forces with Epicor and the opportunity
it creates to rapidly accelerate the momentum Spectrum has built in
the HCM market," said Sybll Romley, CEO and president of Spectrum.
"The economic downturn has shifted much of the focus of corporate
HR from recruitment and on-boarding to talent management and
employee development. With increasingly decentralized workforces,
the rise of social networking, and rapidly evolving government,
privacy, and regulatory compliance requirements, the value of a
truly integrated HCM solution that aligns HR best practices with
the overall business objectives of a company is significant."
"Epicor's infrastructure and global presence also provides a
strong platform to expand into new markets and geographies as a
best-in-class solution," Romley stated. "Our customers will benefit
from the technology and product roadmap synergy between Epicor and
Spectrum, as well as having direct access to Epicor resources
worldwide -- which we expect will deliver even greater value to all
of our customers."
Spectrum: Comprehensive HR Functionality
Epicor plans on continuing to develop and support the Spectrum
iVantage® HRIS product offering, in line with Epicor's "protect,
extend and converge" strategy. The Spectrum solution covers all
aspects of an organization's HR needs, from applicant tracking and
hiring to workforce management and succession planning. The
intuitive, easy to use, browser-based interface and automated
workflow provide a high level of employee self-service, enabling HR
professionals to reduce time consuming clerical functions and focus
on developing organizational and workforce strategies that can
improve the bottom line. Powerful analytics and productivity
reporting tools provide a complete picture of the workforce for
better strategic planning and operational alignment.
The Spectrum offering will be immediately available to Epicor
customers as an "extend" component integrated with their Epicor ERP
solution. A full range of delivery options will be available
including on-premise, hosted/managed services, or software as a
service (SaaS).
(1)Source: Gartner, Inc., "Key Issues for Human Capital
Management Software, 2010" (Mar. 24, 2010)
About Spectrum Human Resource Systems
Corporation Spectrum, founded in 1984, is renowned for its
best-in-class web-based HR systems and industry-leading service --
providing an unparalleled user experience. As a full system and
service provider, Spectrum delivers the full range of
product-related services, including system planning,
implementation, training, system customization, data conversion and
system consulting. Spectrum is a Microsoft® Gold Certified Partner
and participant in Microsoft's Technology Adoption Program.
Headquartered in Denver, Colo., Spectrum can be reached at
800-477-3287 or on the Internet at www.spectrumhr.com.
About Epicor Software Corporation Epicor
Software is a global leader delivering business software solutions
to the manufacturing, distribution, retail, hospitality and
services industries. With 20,000 customers in over 150 countries,
Epicor provides integrated enterprise resource planning (ERP),
customer relationship management (CRM), supply chain management
(SCM), human capital management (HCM) and enterprise retail
software solutions that enable companies to drive increased
efficiency and improve profitability. Founded in 1984, Epicor takes
pride in more than 25 years of technology innovation delivering
business solutions that provide the scalability and flexibility
businesses need to build competitive advantage. Epicor provides a
comprehensive range of services with a single point of
accountability that promotes rapid return on investment and low
total cost of ownership, whether operating business on a local,
regional or global scale. The Company's worldwide headquarters are
located in Irvine, California with offices and affiliates around
the world. For more information, visit www.epicor.com.
Epicor is a registered trademark of Epicor Software Corporation.
Other trademarks referenced are the property of their respective
owners. The product and service offerings depicted in this document
are produced by Epicor Software Corporation.
Forward-Looking Statements Management of
Epicor Software believes certain statements in this press release
may constitute forward-looking statements under the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements include statements regarding the transaction, potential
synergies, the expected impact of the transaction, timing of
closing, future operations of the combined entity and other
statements that are not historical fact. These forward-looking
statements are based on currently available competitive, financial
and economic data together with management's views and assumptions
regarding future events and business performance as of the time the
statements are made and are subject to risks and uncertainties,
including, without limitation, risks associated with market and
economic conditions, Epicor's ability to consummate the
transaction, which is subject to certain conditions, Epicor's
ability to integrate this acquisition and recognize expected
synergies, Epicor's ability to continue to support Spectrum's
customers and add functionality to Specturm's products, and the
risks and uncertainties described in Epicor's Annual Report on Form
10-K for the year ended December 31, 2009 and Quarterly Report on
Form 10-Q for the period ended September 30, 2010. Actual results
may differ materially from those expressed or implied in the
forward-looking statements.
As a result of these factors the business or prospects expected
by the Company as part of this announcement may not occur. Epicor
undertakes no obligation to revise or update publicly any
forward-looking statements.
Contact: Lisa Preuss Director, Public Relations Epicor Software
Corporation 949/585-4235 lpreuss@epicor.com Damon Wright Vice
President, Investor Relations Epicor Software Corporation
949/585-4509 dswright@epicor.com
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