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Tuesday, December 6, 2011 by Neil Ward-Dutton
Today document capture specialist Kofax announced its acquisition of UK-based BPM and case management technology vendor Singularity. This comes on the heels of Lexmark’s acquisition of Dutch BPM technology vendor Pallas Athena – another vendor focused on imaging and document management applications moving ‘sideways’ to capture potential customer interest in broader process improvement projects.
In a call first thing today, Kofax CEO Reynolds Bish highlighted that he expected the acquisition to double the size of the company’s addressable market – in large part through the expansion of sales coverage and effort for Singularity’s products, which Singularity itself had largely confined to the UK.
Kofax intends to deliver tight integration of its servers with the Singularity platform within the next 12 months, and expects the $48.1m acquisition to be ‘earnings neutral’ within the same period. Singularity’s ability to deliver its technology through a Cloud platform appears to be one key factor in Kofax’s choice – on the call it explicitly referred to its intention to build a SaaS-based business to complement its existing methods of deployment (on-premise and private hosted).
One of the interesting nuggets brought out in the Q&A portion of the call was the breakdown of Singularity’s revenues: of a total of around $16m in the past year, roughly 20% has come from license sales; 30% from maintenance; and 50% from services. This was a company with a modest appetite for growth, it seems: however, Kofax intends to kick things up a notch, looking to push up license sales to 40%+ of the overall mix and decrease the contribution of services – relying more on partners to assist with projects. Singularity’s technology is good stuff, and it deserves to be considered by a global audience – let’s see if Kofax can pull it off.
With the acquisitions of Global 360 and Metastorm by Open Text and the acquisition of Pallas Athena by Lexmark, 2011 has seen a bunch of BPM technologies being rolled into what are at their foundation content and document management plays. It’ll be interesting to see what 2012 holds…