Scala and Epicor set to join forces

In a deal worth approximately $US87 million, mid-market ERP providers, Epicor Software and Scala Business Solutions, are combining forces to tackle more global markets and select verticals.

The new entity – which will have a combined base of 20,000 customers and $US250 million in projected annual revenues – will offer more “feet on the street”, according to Epicor director of Asia-Pacific, Jason du Preez. Subject to approval, the merger is expected to close early in the new year.

Epicor currently has 12 A/NZ partners including systems integrators and consulting firms. Morphed with Scala, which has three resellers in the region, it will sell solutions for the .NET platform and Web services.

“The merger gives us access to more markets – ones we traditionally haven’t played in,” du Preez said.

Epicor mainly eyed North America, Australia and the UK, while Scala dipped its toe into some European markets and China, he said.

Both companies are looking to the mid-market space with a heavy focus on Microsoft technology and product lines, du Preez said.

The new entity would be one of the largest mid-market providers of integrated ERP, CRM and SCM solutions, he said.

While both players were strong in the manufacturing space and share some overlap, Epicor could share its expertise in distribution, retail, healthcare, IT, finance and professional services as well as with its e-product line, he said.

For Scala, company strengths included a hearty emphasis on the pharmaceutical arena, as well as peddling tailor-made modules for hospitality, service management and project management, national manager for Scala Australia, Gayle Leuenberger, said.

“We offer a much broader base than Epicor,” she said, "and expertise in a host of areas with more modules.

“From a reseller perspective, the move is positive because we’re dealing with a much larger vendor with an Australian presence,” she said, and it will give Scala much wider international coverage.

But the main challenge, she said, was blending company cultures and solutions.

“We’re coming from two different streams and one would hope we take the best features from one and move them over to the other ... But with any merger, there are always challenges to ensure progress is streamlined and done in a positive fashion,” Leuenberger said.

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