K3 Business Technology Group says it has sniffed the offers on the table from prospective buyers and didn't like the smell. The mid-market ERP firm, which has retail software, manufacturing software and managed services units, went public in March that it was reviewing offers from numerous suitors. But more than six months …
Not really a very lively market these day, the EPOS sector, so it's no surprise that the K3 didn't attract any good offers.
In the same sector, Cerberus had to offload Torex recently for £160m odd, having bought it for £205m a few years back in some very shady dealings by RBS. Cerberus's new management were convinced that they could bolt on a few acquisitions, polish the brass nameplate, and sell it on for a billion dollars. All those shareholders and employees who were short changed in the original Torex Retail debacle can at least enjoy the satisfaction that Cerberus came out of this smelling of s***. But I suspect that the loss on sale that Cerberus would have realised did nothing for K3's sale prospects, whilst making an even more sizeable competitor for K3's operations by bringing together Micros' UK interests with the legacy Torex contracts.
They havent fully integrated Panacea and FDS yet, seems like they are trying to offload early.
Well to be fair that' sounds like the normal business model in EPOS: Write or buy one EPOS system, list your business, go on a serial acquisition spree, and then try and flog the wobbly pile of crap to somebody who can't see what is coming. Torex Retail were on that path before the made up numbers fell apart, and the Cerberus owned Torex Ltd wanted to do it some more, but ended up selling out to Mircros (probably tried to sell them to Retalix, who were undoubtedly offered K3 as well).
The core problem is that you can write a credible EPOS with two men, a dog, a shed, and a pair of computers (as Ed Dayan did with Retail J, if I remember correctly). So the serial acquirers build up stables full of acquired non-compatible systems, hoping to build a defendable annuity base of software maintenance, but there's nothing to stop retailers or software wizzes from conjuring up a new one. The classic market with few barriers to entry, and particularly cost conscious customers who know both the price of everything and the value of everything.
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