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Technology Stocks : Enterprise Informatics -- Ignore unavailable to you. Want to Upgrade?

To: bob zagorin who wrote (2944)	12/8/1998 12:29:00 AM
From: bob zagorin	Read Replies (1) \| Respond to of 13797

December 7, 1998 PC Docs Rejects Takeover Bid From Software Rival Open Text Dow Jones Newswires TORONTO -- PC Docs Group International Inc. Monday said it has rejected a takeover offer from rival Canadian software maker Open Text Corp. The company said the exchange ratio of one Open Text share for every four PC DOCS shares outstanding was "woefully inadequate." The offer, announced last week, is valued at $118.4 million based on Open Text's closing price of $19.25 in Nasdaq trading Friday and PC Docs' 24.6 million American depositary receipts outstanding at the end of the last fiscal quarter. PC Docs, citing concerns about Open Text's long-term prospects in the face of increasing competition from mainstream infrastructure vendors, said it has decided to cease any further communication with Open Text regarding the takeover offer. The conclusion was backed by the company's financial advisor, CIBC Wood Gundy/Oppenheimer. Instead, PC Docs said an advisory committee of outside directors formed by the company in February will continue to pursue strategic initiatives, including possible acquisitions and alliances, to boost shareholder value. Open Text, of Waterloo, Ontario, develops software that allows companies to manage and manipulate information over corporate networks based on the Web. Toronto-based PC Docs develops similar software that allows users to manage and analyze information stored in computer documents. Open Text's customers tend to be big manufacturers. That means the acquisition of PC Docs would broaden its customer base to include PC Docs' big market share in sales to legal and accounting professionals. In addition, Open Text would automatically get access to markets in Europe when PC Docs is more established. Open Text's business is focused in North America. Defending its decision to remain independent of Open Text, PC Docs said it has achieved a five-year compound annual growth rate of 47% and that it is planning "aggressive" cost-cutting moves over the next 12 months that are expected to result in annual cost savings of C$10 million. The company said that as of Sept. 30, it had cash on hand of about $58 million Canadian dollars (US$37.8 million), shareholders' equity of C$82 million and total assets of C$174 million.