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Verity To Acquire Cardiff Software

With the purchase of Cardiff, Verity will own technologies for capturing documents and form-based information and moving it through business processes.
Verity Inc. stepped into a new area of information management Monday when it agreed to acquire privately held Cardiff Software Inc., a maker of document-capture and forms-processing tools, for $50 million in cash.

Verity, which identifies itself as an intellectual-capital-management vendor, is best-known for its ability to analyze and deliver relevant search results from unstructured business data that can't be stored in traditional databases. With the purchase of Cardiff, whose E-forms and document-capture software is commonly used for processing such things as loan applications and insurance claims, Verity will own a suite of tools that capture documents and form-based information and move that data though business processes. The combined ability to capture, process, analyze, and search unstructured information will put Verity in competition for a billion-dollar market, president and CEO Anthony Bettencourt said during a conference call with analysts Monday.

Bettencourt also acknowledged that the deal will bring new competitors into Verity's sights, such as Cardiff rivals Captiva Software, Dicom Group's Kofax, and ReadSoft. But Bettencourt instead focused on the market opportunity facing Verity and the increased capabilities being added to its product line. He said customers would benefit from improved intelligence in their decision-making because of the ability to search and analyze data in process rather than having to wait for that data to reach a content repository. "This move expands our footprint in the enterprise," Bettencourt said.

Analysts seemed to agree, saying the purchase price--about double Cardiff's annual revenue--was reasonable and that the combination of companies appears to have potential. "I find it a really interesting and creative acquisition," says Steve Weissman, president of consulting and business-analysis firm Kinetic Information.

Bettencourt said the products already have a modicum of integration through common partnerships with content-management vendors, but there's a lot of integration work that remains. He also said that despite the newfound ability to capture information and shepherd it through business processes, Verity doesn't consider itself in competition with content-management vendors. Rather, he described the combination of Verity and Cardiff as "more valuable and complementary" to content-management products.

The transaction, which is subject to customary closing conditions, is expected to close within 60 days.

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