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Friday November 21, 9:22 am Eastern Time
Company Press Release
SOURCE: Complete Business Solutions, Inc.
Complete Business Solutions, Inc. to Merge With Synergy Software, Inc. For Approximately $32 Million in Stock
Deal Adds Specialized ERP Packaged Software Implementation Expertise And Client Base
FARMINGTON HILLS, Mich., Nov. 21 /PRNewswire/ -- Complete Business Solutions, Inc. (Nasdaq: CBSL - news) a worldwide information technology (IT) consultant and service provider to large and medium-size organizations, today announced the signing of a definitive merger agreement (subject to regulatory approval) with privately held Synergy Software, Inc. for 904,552 shares of CBSL common stock, currently valued at approximately $32 million. Synergy, which had trailing twelve month revenues of approximately $12 million, has earned a reputation as a premiere provider of Packaged Implementation and Open Systems Solutions for middle markets. The merger, which will be accounted for as a pooling of interests, is expected to be accretive to CBSL's earnings per share based on Synergy's operating margins in excess of 15 percent.
''We plan to quickly implement joint marketing programs utilizing Synergy's special expertise in packaged software implementation, in conjunction with our broad IT service and consulting capabilities, to bring ever more complete solutions to CBSL's and Synergy's clients,'' said Raj Vattikuti, Complete Business Solutions' president and chief executive officer. ''It is the first step to grow our business through acquisitions, mergers and business combinations -- a strategy to take advantage of complementarities such as this merger -- and to continue to participate in the consolidation of our fragmented industry.''
Synergy Software, Inc., headquartered in Schaumburg, Illinois, has approximately 100 consultants and will be operated as a division of Complete Business Solutions under the direction of Synergy's President, Richard Earley. Co-founder and former chief executive, Carl DePaolis, will continue to play a major role, to assure that Synergy's valued clients realize the technical benefits available from the merger.
''We look forward to working with Synergy to establish an ERP Center in Chicago,'' mentioned Raj Vattikuti. ''This center will provide training in PeopleSoft and SAP technologies, and will complement all aspects of ERP Packaged Software Implementation services that we currently offer. It will also assist us in attracting top talent from the Big 6 and similar firms to staff future projects and in developing the skills of our existing employees.''
''The team at Synergy has built a remarkable organization capable of matching or surpassing client expectations, with high-end consulting and a strong track record of delivering a wide range of solutions,'' noted Earley. ''This resulted in our revenues growing by approximately 40% over last year.''
''Consolidation of the IT service and consulting industry is a response to companies' evolving needs for more complete solutions to IT problems,'' continued Vattikuti. ''Of course, 'complete solutions' has been our mission as well as a part of our name over the past 12 years - and the merger with Synergy enhances that.
''Our companies are a 'natural fit,' both for our clients and our employees. CBSL has often been engaged to consult with mid-sized clients, where our capabilities are significantly enhanced by Synergy's expertise. Similarly, Synergy's clients will now be able to take advantage of CBSL's broad range of services and global delivery capabilities. This will result in seamless solutions to our clients' problems and particularly enhance our strategic growth, especially in packaged software implementation.
''We anticipate that Synergy will maintain their existing account relationships and utilize their mid-market expertise to add new clients. They will be able to take advantage of CBSL's size and financial strength to get in the door, build customer relationships and cross-sell CBSL's broad range of services and global delivery capabilities.
''It is our philosophy that effective combinations of this kind will help us to create future growth in the next two or three years.'' concluded Vattikuti. ''We wanted a company that would blend well with our corporate culture, and one that could team with our employees to add value and create long term sustainable growth. We expect to capitalize on our mutual strengths to satisfy our investors, our employees and our customers.''
This release contains forward-looking statements relating to future financial results or business expectations. Business plans may change as circumstances warrant. Actual results may differ materially as a result of factors over which the company has no control and other business risks. Such factors include, but are not limited to: mergers and the ability to integrate them on a timely basis, significant client assignments, recruiting and new business solicitation efforts, currency exchange rate fluctuations, domestic and foreign government regulations, and general economic conditions. These risk factors and additional information are included in the company's reports on file with the Securities and Exchange Commission.
About Complete Business Solutions, Inc.
CBSL is a worldwide provider of information technology (''IT'') services to large and mid-size organizations. The Company offers its clients a broad range of IT services, from advising clients on strategic technology plans to developing and implementing appropriate IT applications solutions. CBSL offers custom-tailored solutions based on an assessment of each client's needs.
The Company's services include: Year 2000 conversion and testing services; large systems applications development and maintenance; reengineering legacy applications to client/server technology; client/server applications development; IT consulting services; packaged software implementation; and contract programming services. For the nine months ended September 30, 1997, CBSL's revenues increased approximately 31 percent to $80.3 million, from $61.5 million for the nine months ended September 30, 1996.
About Synergy Software, Inc.
Synergy's history is closely linked to Borders Books and Music, the national superstore retail chain that Louis Borders founded in 1971. Borders contracted with information systems specialist, Carl DePaolis, in 1988 to design the industry's first expert system-based purchasing and retail business application. In December 1989, Louis Borders and Carl DePaolis decided to establish Synergy and based their business on the fundamental premise that they could help corporations in a variety of industries to achieve marketplace leadership through the use of technology information systems.
For more information on Complete Business Solutions, Inc., visit the Company's website at www.cbsinc.com or dial 1-800-PRO-INFO and enter the ticker ''CBSL''.
SOURCE: Complete Business Solutions, Inc.
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