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Sage buys pounds 88m US software supplier

Wednesday 03 February 1999 19:02 EST
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SAGE, the accounting software group, has strengthened its operations in the United States by buying Peachtree, a rival supplier, for pounds 88m, writes Peter Thal Larsen.

The deal complements Sage's existing US operation, which is based on State of the Art, the West Coast-based software group which Sage bought a year ago.

Peachtree, based in Atlanta, sells accountancy software to small business users through retail outlets. SOTA sells mainly through value-added resellers.

Sage bought the business from Automatic Data Processing, the US services giant, which had originally planned to float the company on the stock market but changed its mind last October when the financial markets wobbled.

"We have been looking at the entry level market in the US for a while," said Paul Walker, Sage's chief executive. "Peachtree complements precisely the business we bought a year ago."

To help fund the deal, Sage yesterday raised pounds 66.6m by placing 3.49 million new shares with institutional investors at 1910p.

Sage shares surged through the pounds 20 mark for the first time yesterday as investors responded positively to the deal. They closed up 77.5p at 2040p.

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