Performix to buy smaller US rival

Performix Technologies, a Dublin-based software company, has agreed to buy a smaller US rival, Cliffstone Corporation.

The all-share transaction negotiated by Performix was concluded during a difficult period for Cliffstone, which recently downsized its operations.

The acquisition will boost Performix's US operations by adding several customers, such as American Express, Sprint, DirectTV and the telecoms firm SBC.

Cliffstone competed against Performix in the market for software monitoring and managing employee performance.

But its core Prism software product will provide Performix with better analytical and design skills when it is integrated, according to Mr Cathal McGloin, chief executive of Performix.

"Now is the time for us to build for the future," he said in an interview with The Irish Times.

"It is fair to say that there is better value in the market nowadays."

Performix has issued Cliffstone's shareholders with 5 per cent of the Dublin-based company's shares.

Cliffstone's founder and chief executive, Mr Stephen Beckett, will join Performix as vice-president of product strategy, and all 14 Cliffstone clients will transfer to Performix.

The Dublin-based company made revenues of about €10 million during 2002 and expected to grow by at least 25 per cent during 2003, according to Mr McGloin.

The firm has raised a total of $25.7 million (€21.8 million) in venture capital funding since it was founded in 1998.

Performix is one of a clutch of small Irish software companies that have become involved in mergers and acquisitions in recent months.

Parthus, Eurologic and SmartForce have all merged with US rivals in the past year as the downturn puts pressure on firms to generate economies of scale.

Baltimore Technologies, once the biggest Irish software company, put itself on the market last month.