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LAWSON REPORTS 4Q

Lawson logoIn what was presumably its next-to-last report of fourth quarter results, Lawson Software this week handed out preliminary numbers. It expects revenue for the quarter ended May 31 to be in the range of $208 million to $212 million. That compares with year-ago revenue of $197 million. Earnings per share are expected to range between six and seven cents per share, compared to two cents a year ago.

However, the company's purchase by Golden Gate Capital and Infor is looming during the next calendar quarter and the SEC filings indicate the deal could close before Lawson’s audit is complete. Lawson and its purchaser also filed a variety of information with the SEC relating to the law suits initiated by investors regarding the deal. Two plaintiffs and the defendants have entered a memorandum of understanding in Delaware, a step towards a settlement that still needs court approval. For those not involved in the suit, the most interesting part of this filing is a detailed chart showing the price purchasers offered on the announcement date for similar software companies in terms of multiples of revenue and EBITDA stretching back to 2005. Infor offered 1.76 times revenue for Mapics in 2005 and 2.12 times revenue for SSA Global in 2006. Golden Gate offered 1.87 times for Geac Computer in 2006. Apax Partners offered 2.11 for its recent purchase of Epicor. And looking at those numbers, its' no wonder the investors who sued Epicor settled for disclosures, but got no additional money. The 11.8 times EBITDA that Apax paid for Epicor. That was higher than the ratios paid for 17 companies out of 23 for whom a ratio was displayed. The roughly $1.8 billion that Infor is offering for Lawson is about 2.44 times Lawson’s 2010 revenue.

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