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OpenText’s acquisition of Metastorm: catching up
Tuesday, February 22, 2011 by Neil Ward-Dutton
Last week ECM specialist OpenText completed its purchase of BPM and Enterprise Architecture tools vendor Metastorm for $182m. The deal was originally announced on Feb 2 and was expected to close by the end of March; OpenText has obviously received approval from Metastorm shareholders much more quickly than expected, likely because of the purchase price. Based on Metastorm’s inclusion in Deloitte’s Fast 500 list its FY2009 revenue was estimated at around $70m; although there are no publicly available figures for 2010, it’s very likely that the acquisition price of $182m would have been pretty attractive to Metastorm’s shareholders.
OpenText is no stranger to acquisitions, of course – its 2009 acquisition of Vignette being the most high-profile to date. But with key competitors IBM and Oracle now very firmly in the BPM game and pushing forward with investments to combine ECM and BPM capabilities for case management applications, it’s no surprise that OpenText would be on the lookout for a suitable BPM tools vendor.
Metastorm’s Enterprise Architecture and Business Process Analysis tools, together with its solid integration with Microsoft platform technologies (most notably SharePoint, support for which OpenText also considers a key part of its story for customers) would have made it particularly compelling. Although players like Global360, Ultimus, AgilePoint and K2 all provide very solid integration with SharePoint, with the exception of Global360 Metastorm’s comparatively large size would have made it more interesting from a customer base acquisition point of view.
I should make it clear that I’m not an expert on OpenText, and so I have to defer to others for what this might mean for Metastorm customers. Based on analysis of the OpenText acquisition of Vignette here and here, my guess is that in the short term Metastorm’s customers and their investments will be relatively unaffected – though the long-term direction of release/upgrade momentum looks less certain. Many Metastorm customers have long-term sunk investments in the technology; it would be foolish at this point to announce a radical reinvention of the Metastorm product line. At the same time, Metastorm customers should be making sure they get as much clarity and commitment as possible from their supplier’s new owner.
I’ve not yet managed to have a briefing from OpenText on this; I’m currently trying to get one. If I do get chance to find out more I’ll update here.
Posted in BPM
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