Neon Systems Acquires ClientSoft

Neon Systems Inc., a major integrator of Java and Microsoft .Net applications with mainframe systems, is acquiring ClientSoft Inc., a privately held mainframe integration software supplier.

The acquisition, for $10.5 million in cash and stock-purchase rights for 1.1 million shares of Neon stock, "brings an impressive roster of talent, technology, and customers," Neon president and CEO Mark Cresswell said in a statement.

ClientSoft's Service Builder product line specializes in high-performance, high-security mainframe integration for Java and Microsoft .Net applications to create Web services. The acquisition will add 180 mainframe-integration customers to Neon's base of 300 customers.

ClientSoft customers include Allstate, BearingPoint, Blue Cross Blue Shield of South Carolina, Credit du Nord, R.J. Reynolds, Federal Express, and GE Capital Bank.

Neon offers the Shadow z/Services product line for monitoring mainframe operations and generating Web services from CICS, IMS, and IDMS mainframe systems.

Neon's board of directors will be expanded to create a seat for William Wilson III, president of ClientSoft. Robert Evelyn, senior VP of technology and chief operations officer of ClientSoft, will become senior VP of strategy and solutions at Neon; Hugh Raiford, ClientSoft's senior VP of corporate development, will become Neon's VP of corporate development for Neon; and Fady Moussallam, VP of engineering, will become VP of product strategy.

Neon Systems acquired InnerAccess, a company specializing in converting mainframe systems to Web services, in July.