Geac Computer plans to turn its UK based JBA Holdings acquisition into a new division dubbed Gear that will focus on the midrange enterprise resource planning (Erp) applications market.
In the process, the firm plans to cut 20 per cent of its staff, or the equivalent of 500 people as part of an attempt to reduce overheads. The aim is to cut annual costs by about C$90 million, effective from this current quarter.
Douglas Bergeron, Gear's president and chief executive officer, also said he was now in the process of evaluating the company's research and development (R&D) programmes.
"We have 4,500 global customers who see great value in the JBA product suite. Customers want R&D refocused back on the core products to make them even better," he claimed.
The Canadian applications giant intends to focus its efforts on JBA's AS/400 System 21 product line, its @ctive Enterprise ecommerce packages and its Windows NT based Streamline ERP application suite.
Bergeron added that sales and marketing would also be realigned to get back in touch with customers, to provide vertical sector expertise and focus on promoting ecommerce software.
Jim Mendelson, an analyst at SoundView Technology Group, said that the move reflected the company's attempt to move into more profitable industry sectors and catch the Internet wave.
"The ERP section hit a wall about a year ago in terms of licensing revenue. We haven't seen as many acquisitions here as we have seen in other spaces. But it underscores the sense of urgency out there," he added.
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