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Sybase in $95.2M Mobile Software Play

Sybase Friday moved to shore up its mobile software offerings Friday by agreeing to acquire XcelleNet, which makes software to help workers manage information from for wireless devices and remote locations, for $95.2 million in cash.

The Dublin, Calif.-based database software maker, which also announced preliminary earnings, will integrate XcelleNet into its iAnywhere Solutions subsidiary, which provides mobile database software and middleware. Atlanta's XcelleNet will add remote device management and mobile security technologies to the iAnywhere portfolio.

With roughly a 73 percent share, iAnywhere has been the mobile database leader for six years and serves over 12,000 corporate customers. Acquiring rival XcelleNet, which specializes in making software to help keep remote employees in the corporate loop, will help Sybase bolster its unit's market leadership, company officials said.

More broadly, the assets are expected to help Sybase improve its Unwired Enterprise portfolio for creating products that help organizations manage and mobilize data on the go. Sybase announced the initiative, with Intel in tow to offer developer training programs, last November.

XcelleNet has two main brands, Afaria and RemoteWare. Afaria helps users provide configuration, security, and back-up management for laptops, tablets and handheld computers. The suite provides a Microsoft .NET-based console that lets employees manage activities from a browser.

RemoteWare provides point-of-sale (POS) management to help users support Windows, Unix, Linux, or DOS server-based POS systems, as well as and Windows laptops and desktops. The software is primed for everything from asynchronous dial-up connections to frame relay IP networks.

Stephen Drake, program manager for IDC's Mobile Infrastructure Software Service, said the Afaria assets, with their focus on providing levels of security and management for mobile devices are the key components of the acquisition for Sybase. RemoteWare provides inventory management for legacy POS systems in customer service- oriented environments such as retail stores, he said.

The deal is not a competitive strike against anyone per se, Drake explained, but rather a complementary add-on to the Unwired Enterprise initiative.

"XcelleNet has focused on this market for a long time and has carved an innovative niche," Drake told internetnews.com. "As companies begin to roll out more and more devices for employee use, security and management becomes a concern and XcelleNet software can be used to rein in the devices."

Sybase also expects to gain 2,200 global customers through the deal in addition to new and expanded relationships with partners and independent software vendors (ISVs) such as HP and Microsoft.

Sybase expects the transaction to close in the second quarter of 2004.

Meanwhile, Sybase reported that Q1 total revenues will likely be in the range of $183 to $185 million, with earnings-per-share in the range of 18 to 20 cents. Analysts had estimated an EPS of 24 cents.

Sybase Chairman, CEO and President John Chen said sales were impacted by the failure to close several large telecom this quarter "as anticipated, but which we expect to close future quarters."



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