Lawson CEO Mostly Mum on Icahn Talks

There's still no public word of what may come of billionaire investor Carl Icahn's stake in ERP (enterprise resource planning) vendor Lawson Software.

Lawson has "met with Mr. Icahn and other representatives of his firms, and the interaction was cordial and constructive," CEO Harry Debes said during a conference call announcing the vendor's fourth-quarter results on Thursday.

However, "nothing has changed in our business plan or our day-to-day operations. It is business as usual for us," Debes said. Lawson cannot comment further, he added.

Icahn is known as an "activist investor," with a track record of aggressively seeking a say in how companies operate. He also advocates for decisions he believes would boost returns for shareholders, including selling the company in question. In a filing disclosing his stake in Lawson, Icahn said its shares were undervalued and expressed desire for a meeting with its executives to discuss how to maximize shareholder value.

Lawson is one of the software industry's largest ERP vendors after Oracle, SAP, Microsoft and Infor.

Some analysts expect Icahn, who could not immediately be reached for comment Friday, will indeed push for a sale, lobbying other shareholders behind the scenes to set a plan in motion. He could gain some leverage from Lawson's mixed earnings report Thursday.

In its fourth quarter, ending May 31, the company saw revenue rise 6 percent from the same period last year, to US$197 million. But net income dropped to $2.6 million from $8.6 million in the same quarter last year, due to increased costs related to taxes and its recent acquisition of Healthvision.

For the full year, Lawson posted $736.4 million in revenue, down from $757.3 million the year prior.

The company also provided first quarter fiscal 2011 guidance that fell below Wall Street estimates.

But there are early positive signs for Lawson's recent entry into cloud-based software deployments via its partnership with Amazon Web Services, according to Debes.

Lawson has about 20 solid early prospects, including with large companies, and expects to sign deals "in the next quarter or two," he said during the conference call. Some 85 percent of these opportunities are with new customers, he added.

Chris Kanaracus covers enterprise software and general technology breaking news for The IDG News Service. Chris's e-mail address is Chris_Kanaracus@idg.com

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