PeopleSoft: Edwards Merger Is On Path To SuccessPeopleSoft: Edwards Merger Is On Path To Success

PeopleSoft Inc. executives say they're well on their way to proving that their $1.7 billion acquisition of J.D. Edwards & Co., and subsequent integration efforts will be the successful exception that proves the rule about the reality of a difficult corporate integration and product and customer incompatibilities conspiring to sabotage the results.

"We started with different objectives than those in most mega-mergers," says Ram Gupta, executive VP of products and technology for PeopleSoft told information at this week's PeopleSoft Connect customer conference in Anaheim, Calif. "We were not looking for consolidation. In most mega-mergers, the acquiring companies enter into them looking to use the consolidation to become profitable--or it's done from greed and they start shutting down operations."

PeopleSoft and J.D. Edwards both were profitable, and PeopleSoft recently gave guidance that it expects per-share income of 90 cents from the combined company in 2004, up from guidance of 50 cents to 55 cents for PeopleSoft alone in 2003.

"We are confident we can pull it off, and we're already seeing signs of success," Gupta says. "This management team has the desire, commitment, and bandwidth to do it. The proof is in the delivery as the quarters roll by, but are very excited about the possibilities and about what we are already delivering."

Enterprise One 8.9, the midmarket product that's replacing the equivalent J.D. Edwards One World 5.9 release, is scheduled for delivery next week, providing one of the first integrated products of the combined company. That release, and the fourth-quarter debut of Enterprise 8.8, will demonstrate how well the two portfolios and customer bases intertwine, PeopleSoft executives say.

J.D. Edwards products were focused strongly on asset management, and PeopleSoft was strong in service automation and management. Both companies have strengths in different industries. Together, new products will be able to deliver the best applications to all customers, Gupta says. "The integration is designed around the strengths of both companies," he adds. "We'll have more products, more countries, more industries, and more markets."