Oracle rumors swirl as Lawson users wait and wonder

Lawson's user conference is next week, but customers don't yet know if it will be bought by Infor or even Oracle

Lawson Software customers still don't know the fate of the company following Infor's roughly US$1.8 billion acquisition offer earlier this month, with just days to go before Lawson's annual CUE conference in Boston.

Speculation that Oracle would submit a counter-offer for Lawson picked up again this week, although neither company would comment on that prospect.

Activist investor Carl Icahn, who took a stake in Lawson last year, has given a nod of approval to Infor's offer. Icahn is known for pushing companies he invests in to take actions he believes would benefit shareholders, such as a sale.

Meanwhile, Lawson users are watching and waiting, some with dread anticipation of what's to come.

Ever since Lawson went public in late 2001, "the quality hasn't been there, the service hasn't been there," said one long-time user who works in IT at a hospital chain in the Midwest. "It's been harder to get to knowledgeable people, and it takes longer to get issues resolved and fixed. It's been kind of a love-hate relationship with Lawson."

The user, who requested anonymity due to the situation's sensitivity, expressed concerns over what would happen if Lawson is purchased by Infor or Oracle, both of which are known for running lean operations.

It's not as if it would be easy for his company to switch ERP (enterprise resource planning) systems, and only partly because of the organizational and financial impacts, he said. Organizations like his "really need something that's specific to health care, especially in HR," he said.

For now, the company will remain "cautious about any additional investment in Lawson above and beyond what we have now," he added.

Another Lawson user said he is taking a wait-and-see approach.

"Based on what I know, it appears that Lawson is doing due diligence and evaluating its financial position and making sure everything is on the up-and-up before moving forward," said Don Zoz, president of the Lawson Mid-America User Group, via e-mail. "If it appears that this would be a good move for Lawson, I'm not opposed to the transaction."

However, "as always, I'm concerned that user support could be affected if the resulting company grows too large," Zoz added.

Privately held Infor has reported revenues north of US$2 billion, while Lawson logged $736.4 million in its fiscal 2010. The combined company would be the industry's largest ERP vendor after SAP and Oracle.

Lawson customers might take some encouragement from Infor's recent announcement that it plans to hire some 400 engineers in order to boost product development efforts.

Infor's move has been seen as an attempt by its new leadership team, which includes former Oracle co-president Charles Phillips as CEO, to rid the company of its image as more of a collection of acquired vendors than an organization geared toward new software innovations.

An Infor spokesman declined to comment Tuesday on the status of its offer for Lawson.

Chris Kanaracus covers enterprise software and general technology breaking news for The IDG News Service. Chris's e-mail address is Chris_Kanaracus@idg.com

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Tags Oraclebusiness issuessoftwareapplicationsInforMergers / acquisitionsLawson Software

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Chris Kanaracus

IDG News Service
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