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Will the enterprise market spend significant IT budget on Windows Vista in 2007?

Yes

No


Software M&A Insights
continued... page 2


WorkStream (NASDAQ: WSTM) acquires Bravanta
Category: Incentive Management
Purchase Price: $5,600,000
Seller Revenue: $5,600,000 Estimate
Revenue Multiple: 1.0x
Payment Terms: Stock

SEG’s Perspective:
Workstream, a provider of hosted workforce management solutions, acquires another incentive management software company. This time it’s Bravanta, a San Francisco startup which has raised over $46 million from large VCs. The deal comes two months after Workstream’s acquisition of compensation management solution provider Kadiri, and is WorkStream’s third buy this year. WorkStream’s strategy is to grow through acquisition and seek a buyer when consolidated revenue reaches $35 million to $40 million. With Bravanto, WorkStream expects to add 300 blue chip customers and $9 million in revenue (a significant boost to its FY2003 $18 million total). With $10 million recently raised in a private placement earmarked for growth, look for more acquisitions from Workstream.

ViryaNet (NASDAQ: VRYA) acquires Utility Partners
Category: Human Resource & Workforce Management
Purchase Price: $5,200,000
Seller Revenue: $5,600,000 Estimate
Revenue Multiple: 0.9x
Payment Terms: Cash, Stock

SEG’s Perspective:
ViryaNet, a developer of internet based software for managing service operations through browsers, wireless devices, laptops, and PCs, acquires Utility Partners (UP), a mobile workforce management solution provider for the utilities vertical. The acquisition eliminates a competitor in the utilities sector where ViryaNet has focused. ViryaNet, which hasn’t had a profitable fiscal year since 1996 and currently posts a $13.3 million market cap, financed the acquisition with 52% stock and the balance in cash. ViryaNet, whose TTM revenue is $13.4 million, will get a significant boost from UP’s approximately $5.6 million in revenue. The deal coincided with an announcement by one of ViryaNet’s competitors, MDSI, which terminated its acquisition of mobile resource management provider @Road.

EV: Enterprise Value = equity purchase price, plus seller’s interest bearing debt, minus seller’s cash & cash equivalents



This report was prepared by Software Equity Group, L.L.C. (SEG), a mergers and acquisitions advisory firm serving the software, life science and technology sectors. SEG is solely responsible for its content. This material is based on data obtained from sources we deem to be reliable; it is not guaranteed as to its accuracy and does not purport to be complete. This information is not to be used as the primary basis of investment decisions. For more, please visit www.softwareequity.com, or phone (858) 509-2800.

     






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