Vignette Corporation (NASDAQ:VIGN), an Austin, Texas-based web content management business, does not anticipate a sale despite speculation it is a takeout target, SVP Dave Dutch said in an interview.
Autonomy of the UK acquired Vignette’s only pure play peer in the content management space last week, renewing rumors it could be taken out, especially as its stock price hovers near its 52-week low. Vignette’s market capitalization is USD 166.5m, down from USD 330m 12 months ago. Interwoven was acquired for a 36% premium, which was equal to its 52-week high.
If Vignette were to sell in 2009, it would likely happen in the next 60 days while Vignette’s stock price is so low. As I mentioned earlier, Vignette’s low stock price could draw offers from vendors like EMC, HP, IBM, and Oracle if they want to expand their “industrial strength” web content management (WCM) capabilities. IBM has a fixed content offering, and Vignette could expand its content management solutions to the Internet.
Vignette’s Dutch said the company is focused on growth, not a sale, as evidenced by the investment it has made in upgrading its technology platform to enterprise grade Java from Sun Microsystems. Asked about potential buyers in the space, he said Microsoft and IBM also have content management products so are unlikely to make acquisitions. SAP of Germany is yet to make a move, he noted. He said the sale of Interwoven did not necessarily make Vignette a more likely target because Interwoven was focused on a different vertical with its legal compliance offering.
Vignette has been rumored to be a target for Hewlett-Packard for the past 12 to 24 months. Vignette’s solid maintenance revenues and customer base make it a likely candidate for acquisition. HP CEO has grown through large acquisitions aggressively; While HP has document management services, Vignette’s offering is more mature so may be an attractive upgrade. It may also be bundled into EDS’ content management services offerings. A more distant possibility is Google buying Vignette to build out the infrastructure side of its online business. Cisco Systems is increasing its presence in the web and may be interested in Vignette to augment its offering with a web management component too.
Vignette may also appeal to Open Text Corporation of Canada, which has a mid-range web content offering, but does not have a “heavy metal” web content offering. Omniture, a web-testing analytics company, could also be a logical buyer.
Dutch said Vignette has not retained a bank, but works “opportunistically” with advisors. The company tends to work with smaller banks. Vignette’s general counsel contracts out legal work where appropriate to various individuals, he said. Vignette is currently looking at making buys while values are low, Dutch said. It has nearly USD 150m in cash.
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