Cognos Inc. (COGN) and Applix Inc. (APLX) have announced a definitive agreement for Cognos to acquire Applix in a cash acquisition valued at $17.87 per share. This equates to $339 million, or about $306 million net after you back out the Applix cash on hand.
Applix, Inc. provides business performance management and business intelligence applications, which is roughly in the same spots as Cognos. Another business intelligence software company gets gobbled up.
The transaction is of course subject to regulatory approvals and other customary closing conditions, although there should not be any regulatory hurdles here if you consider the size. Cognos expects the acquisition to be completed in the fourth calendar quarter of 2007.
Cognos shares are indicated down 2% pre-market on the dilution expected, although this is not even 10% of the size of Cognos. Applix shares are up 22% at $17.60 pre-market, which is less than 2% short of the total cash consideration. Applix’s prior 52-week high was $17.73, and that is up more than 100% from the $8.00 lows. Considering Applix stock traded well under $5.00 as recently as 2005, this should be a done deal where all holders make money on it.
Jon C. Ogg
September 5, 2007
Jon Ogg can be reached at email@example.com; he produces the Special Situation Investing Newsletter and he does not own securities in the companies he covers.