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Onyx, M2M Finalize CRM Vendor Purchase
[August 02, 2006]

Onyx, M2M Finalize CRM Vendor Purchase

TMCnet Contributing Editor

CRM vendor Onyx Software Corp. has announced that Onyx shareholders have approved the company's acquisition by M2M Holdings Inc. at a special meeting of shareholders held at the company's headquarters in Bellevue, Washington.

Shareholders of approximately 76 percent of the total outstanding shares of Onyx stock voted in favor of the merger proposal, representing approximately 93 percent of the total shares voted, according to company officials.

According to terms of the agreement, M2M will acquire all outstanding shares of Onyx Software for $4.80 per share in cash. The transaction is expected to close today, at which point Onyx Software will cease to be a publicly traded company.

M2M Holdings Inc. is the holding company that is jointly owned by Battery Ventures VI, L.P. and Thoma Cressey Equity Partners and whose primary asset is Made2Manage Systems Inc., an enterprise software and services company.

In late July Onyx announced that China-based CDC Corporation was "withdrawing and terminating its previously announced $5.00 per share all cash tender offer for all outstanding shares of common stock of Onyx Software Corporation."

The offer was put on the table July 12, 2006 and was scheduled to expire on August 8, 2006.

Back in January Hong Kong-based CDC had offered to combine all the assets of CDC Software with Onyx, and $50 million in cash, for a majority of Onyx's common stock, keeping Onyx a publicly-listed company. Onyx's management announced almost immediately they were rejecting the deal.

The Puget Sound Business Journal reported at the time that "Onyx officials gave a variety of reasons for turning down the offer, including: CDC Software assets are performing poorly; CDC lacks a sustained history of profitable operations and has a poor record of delivering shareholder value; and synergies between the Onyx and CDC product lines are limited."

Specifically, Dow Jones reported, Onyx said on January 5 its board unanimously rejected CDC's offer for being "highly dilutive" to Onyx shareholders. Plus they didn't think there would be anything but "limited synergies" between the companies. And they didn't like CDC's idea that Onyx pay a premium for CDC Software division assets.

In June Onyx announced it signed a definitive agreement to be acquired by privately-held M2M Holdings Inc. At the announcement it was described as an all-cash transaction valued at $4.80 per share, or approximately $92 million.

In early July CDC offered a cash bid of $5 per share in their hostile takeover bid for Onyx, essentially upping a $50 million cash bid to $80 million. When Onyx decisively rejected CDC's overtures for M2M the Chinese company released a statement that "On July 17, 2006, Onyx announced surprisingly poor preliminary financial results for Q2 2006, including license revenues of only $1.6 million and total revenue in the range of $11.7 million to $11.9 million." Aesop had a name for this sort of thing.

Yesterday Janice P. Anderson, Onyx's chairman and chief executive officer said "we are looking forward to a speedy closing of the merger."

David Sims is a contributing editor for TMCnet. For more articles please visit David Sims’ columnist page.

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