Baan finally is to be sold

Baan is finally for sale. Parent company Invensys made the announcement as part of its trading update yesterday, when it released details of its expected operating profit for the year just ended, of £250 million before exceptional items. Just last October, CEO Rick Haythornthwaite was saying, “watch my lips, Invensys is going to continue to own Baan,” at the Baan Los Angeles user conference. “Baan is strategic to Invensys,” he said, “now can we get back to work.” Brave and forceful words at the time, but, as it turns out, flawed. Invensys had just too much to do to get the ailing giant back on track, and with a rock bottom share price something had to give. The company statement says that it “will be narrowing its focus from two core divisions to one, Production Management.” So that’s primarily the Wonderware MES (manufacturing execution systems) and the process industry-centric Protean systems. Against what’s been a difficult market background, the company had sold what it considered now non-core businesses for around £1.8 billion, but with weakening trading conditions, beyond its Production Management and Rail Systems, “the Group will divest its holdings, either partially or wholly, in all other businesses. “A structured and phased process to achieve this is already underway, comprising Baan, as well as the product-based Appliance Controls, Climate Controls, Metering Systems, APV Baker, Powerware, Lambda, Teccor and Hansen Transmissions. These businesses will be managed in an expanded Development Division, which for the year to March 2002 would have had combined revenues of £2.9bn. “Proceeds raised from asset sales will be used to satisfy the cash requirements of the Group,” and so on. Invensys says it will provide further details of its plans on 29 May when it announces its full year results. We wait for that, but whatever, it’s a huge turn out, and it’s goodbye to Baan for Invensys after a turbulent three years that have seen considerable people, market and technology change – as well as, it has to be said, considerable worthwhile investment. Remember, this will include its CRM (customer relationship management), SCM (supply chain management) and PLM (product lifecycle management) systems and, most important, its considerable web-based integration platform and technologies. Who are the likely takers? Difficult to say. Notable acquisitive ERP vendors in the frame have got to include SSA GT and PeopleSoft. There are others further down the food chain: as ever, much will depend on price, geography, fit and aspirations. You can be sure the price for the prize won’t be high by the standards of a couple of years ago. As for existing users and those currently going through project work, you just have to sit tight. The Baan range is excellent; the company has just been incredibly unfortunate. This one should move quickly.