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Lawson Talks Product As ERP Consolidation Looms

Vendor highlights analytics, BI, mashups and cloud deployments at Boston user conference. But with one takeover bid on the table and rival Epicor now in play, Lawson seems headed for acquisition.

Lawson acknowledged the "elephant in the room" -- an unsolicited $1.8 billion takeover offer -- at the start of its annual user conference on Monday.

But company executives then tried to put the focus on announcements about cloud-based application deployment, a new healthcare analytic application, BI and mashup tools, and an online apps marketplace.

In truth, there's not much executives could say about the unsolicited takeover bid from Infor and Golden Gate Capital. They simply repeated a March 11 statement that the company's board is considering the offer. The outcome will be undoubtedly be influenced by shareholders including Carl Icahn, the well-known activist investor who has stoked interest in a deal. Indeed, Lawson's stock has risen more than 6% since Infor's bid was made public.

The prospect of a deal now looms even larger since private equity firm Apax Partners announced on Monday that it will buy and combine the now-separate ERP vendors Epicor and Activant. Epicor caters to manufacturers while Activant serves distributors and retailers. Apax will pay $976 million for Epicor and the total deal is valued at $2 billion.

There's a strong fit between Epicor and Activant in spanning manufacturing, distribution and retail. The combined firm would have more than 30,000 customers, about $825 million in revenue and will compete even more strongly against Lawson's manufacturer-and-distributor-oriented M3 ERP system.

Just last week, Bloomberg, Forbes and others reported on rumors that Oracle might soon join the pursuit of Lawson, a $757 million company that delivers ERP and human capital management software and services to midsize healthcare, services, public sector, equipment management, manufacturing, and distribution organizations. Lawson and Epicor have every right to entertain higher offers, but with both vendors now in play, it's less likely either one will remain independent.

As for the news that Lawson executives could address here in Boston, the company highlighted a milestone in its cloud-hosting initiatives whereby Scott County, Minnesota, has moved its production S3 ERP application from a conventional hosting data center to Amazon's Elastic Compute Cloud (EC2) via Lawson's Cloud Subscription Offering.

Scott County became the first customer to use Lawson's Amazon-based Cloud Disaster Recovery option in 2010. The county was already using hosted Lawson ERP, but by switching to Amazon from a conventional data-center partner, promised restore times dropped to eight hours from 48 hours previously and data-loss maximums were reduced to one hour from eight hours previously.

Having lived with Amazon service for more than a year and having previously done its due diligence on security and service-level questions, the county was comfortable and confident in moving its entire production deployment to EC2, said Scott County CFO Kevin Ellsworth in an interview with InformationWeek.

"Our costs will be flat for the next three years with the move to Amazon," Ellsworth said. "Our developers tell us it's the smartest thing we could have done because they're now developing interesting and useful apps instead of babysitting servers."

As part of the move to Amazon, the county also consolidated a separate Lawson deployment for one of its county school system onto the same infrastructure at no additional cost.

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