The Challenges of the Lawson-Intentia Merger
P.J. Jakovljevic - October 28, 2005

Challenges

The new management team for the company resulting from the merger of Lawson Software, Inc. (NASDAQ: LWSN) with Intentia International AB (XSSE: INT B) will have its work cut out for it. Both companies serve different markets, which will hopefully extend, not cannibalize each other's client base, but combining two companies with financial and revenue growth issues is not exactly a recipe for success. Although recent quarters for both companies have shown license revenue increases and profitability, neither Lawson nor Intentia have been stellar in terms of their financial performance lately. Despite this recent increase, overall Lawson has been experiencing declining license revenue (down nearly 20 percent since 2002) and has been keeping some appearances of profits mainly by cutting costs. Now that revenues are increasing, this cost cutting and revenue management strategy may provide further opportunity. Intentia, on the other hand has been on a losing streak for years, with its last profitable full fiscal year was 1998...