JBA Holdings handed out redundancy notices to 220 members of its staff last week as the AS/400 reseller's C$205.5 million proposed buyout by Canadian ERP software vendor Geac Computer looked increasingly shaky.
Following a statement by SCH, which holds 11.8 per cent of JBA, that it is unhappy with the valuation of the proposed Geac deal (http://webserv.vnunet.com/www_user/plsql/pkg_vnu_news.right_frame?p_story=87913&p_type=see Newswire 30 July), it has emerged that asset management company Lazards, which holds a 12 per cent stake in JBA, also plans to reject the offer as it stands.
An industry source said: "It only takes one more large shareholder to oppose the deal before Geac has to rethink. It looks like it might have to up the offer or get out."
The development came as 44 employees at JBA's software development division (SDL) in the UK received their marching orders. PC Dealer has learnt that the staff cull, announced last month as part of a global restructure, had been planned since January.
A source claimed JBA has been making a series of cutbacks since the start of the year, when Ken Briddon, former chief executive of Misys, was brought to the firm as chief operating officer, before being appointed chief executive.
In an internal memo, Briddon told SDL staff in July: "For us to meet our objectives we need to reduce our costs and adopt new development models. The first phase of this restructuring will involve a reduction in the number of staff employed within SDL in Studley and Birmingham. The areas to be affected by the redundancies are the core product group, System/21 PC development group, translation, and the management team at Studley."
The source added: "In February, the Sri Lanka division was closed. In June, the Ireland development was closed and the Canadian development was scaled down. It was done bit by bit, but was part of a deliberate downsizing. After massive growth in the early and mid 90s, everything slowed in the ERP sector and this hit us very hard."
A spokeswoman for JBA confirmed that the job cuts were part of JBA's restructure, but insisted that the Geac deal would safeguard the JBA jobs.
For more stories see this week's issue of PC Dealer UK
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