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Pitney Bowes to acquire Firstlogic

Debt Consolidation And Credit By Eric Kleefeld • 09/01/05 La Crosse, Wis. - Pitney Bowes, a mail and document management solutions company based in Connecticut, will acquire data-quality management company Firstlogic in a $50.3 million buyout of La Crosse-based Firstlogic's outstanding shares, it was announced on Thursday.

Company representatives said employment ramifications of the deal won't be known under the consolidation is studied.

The transaction is expected to close in the third calendar quarter of 2005. Frank Dravis, Firstlogic vice president of information quality, said finalization could come as soon as late September or early October, given quick regulatory approval and what Dravis cited as clear approval on the part of shareholders.

Once that process is completed, Firstlogic will become a subsidiary of Pitney Bowes within its Document Messaging Technologies division, and an 18-month integration process will begin.

During that process, Pitney Bowes will study how products and services of the two companies might be bundled, and how each of the companies' respective products and services could be cross-marketed.

Dravis said the acquisition will aid both entities in terms of opening up markets for Firstlogic's projects as well as providing new opportunities and functionality for Pitney Bowes.

"They're interested in us because of our extensive relationships with top-tier systems integrators and enterprise-software vendors like Informatica and Seibel," Dravis said. "This will help enhance [Pitney Bowes's] distribution network and accelerate their global expansion."

Dravis said, however, that it is too early to know how the deal will affect management structures and current Firstlogic employees, as the integration process cannot begin until after the acquisition is completed.

Pitney Bowes spokesman Peter Kerr said a great part of this acquisition -- the company's 50^th in four years -- stems from a process Pitney Bowes has been going through of modernizing in the digital age and taking on adjacent functions as it grows.

"We were known for many decades as the maker of postage meters," Kerr said. "We've grown far, far beyond that into many aspects of mail and document management systems, mail and document services and various solutions for the management of documents and mail."

Pitney Bowes chairman and CEO Michael Critelli said in a press release that the acquisition would help to secure and grow the company's position in the $4 billion customer communication management market, which the company entered last year when it acquired Group 1 software. "Firstlogic's extensive relationships with top tier system integrators and enterprise software vendors enhance our distribution network and accelerate our global expansion," Critelli said.

Pitney Bowes, a $5.3 billion company, has more than 35,000 full-time employees. Its products and services run the range from postage meters to sorting equipment to billing and payments software.

Firstlogic, a privately held company, generated more than $55 million in revenue in 2004 by providing commercial customers, government agencies and Posts with data quality, commercial mail and postal automation software and services such as its IQ8 and the IQ Assurance services.

Click here for past WTN coverage of Firstlogic

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