RealTime IT News

Borland Shells Out $24M For Starbase

Borland Software on Wednesday shelled out $24 million in cash to gobble up Santa Ana, Calif.-based Starbase Corp. , a deal that gives Borland a bigger bite of the market for Web applications.

The deal calls for Borland to acquire all of the outstanding shares of Starbase at $2.75 per share, almost $2.00 per share more than Starbase's 80 cents closing price on Tuesday. In today's early going, Starbase stock jumped a whopping 235 percent on news of the acquisition as shareholders roundly applauded the move.

Borland, which has emerged as the dark horse in the Application Server market share race, also agreed to provide $2 million in bridge financing to fund Starbase through the completion of the merger.

Once the deal gets regulatory approval, Borland plans to distribute Starbase products though its own channels. Starbase makes software that for developers looking to create, manage and change their software programs.

With the deal, Borland assumes more than 4,200 Starbase customers worldwide for end-to-end software that covers management, application software and content development and change and configuration management.

Borland CEO Dale Fuller said it taps into a market estimated to reach $1 billion by 2004 and would speed up its plans to integrating all phases of software development into a single service that unifies the design, development, testing, and deployment phases of the software application lifecycle.

The Starbase deal is the second high-profile acquisition by Borland in recent months. The company, which styles itself as the only independent path to Microsoft's .NET, acquired the assets of Sweden's BoldSoft MDE Aktiebolag, a deal made mostly to gain technology and personnel, which it intends to use for design-driven development for the Microsoft .NET framework.

Back in May, Borland gobbled up the assets of privately held Highlander Engineering, Inc., a transaction valued at around @ million. That acquisition was aimed at integrating Highlander's software products and services into Borland's Enterprise Server to help it tackle the embedded systems market.