CommSoft Buys Brains

MEDIA RELEASE

CommSoft Buys Brains
First Significant Acquisition Using Funds Raised In IPO

Auckland, 15 January 2001 - CommSoft Group Limited (ASX/NZSE: CSG) today added significantly to its telecommunications software offerings with the acquisition of Marketing Technologies, developer of the award winning Brains Customer Relationship Management (CRM) product.
CommSoft will pay $NZ5.75 million for the assets, business interests and intellectual property of Marketing Technologies. The consideration will be paid in cash and CommSoft shares over a three year period.
“This represents a major acquisition of core intellectual property for CommSoft,” says CommSoft Chairman, Greg Gardiner. “Brains complements our existing CRM offerings and positions CommSoft as a serious contender in the fast-growing international CRM marketplace.”
“The technology is easy-to use, flexible and highly scalable,” says CommSoft Chief Operating Officer, Rodney Martin. “Brains is a highly sophisticated CRM and Call Centre offering which is web and WAP enabled.”
“This is the first of a number of acquisitions that we plan to make over time. It will enable us to grow revenues and earnings by selling new product through our existing sales force staff via our existing channels to our existing customers,” adds Mr Martin.
“Growth by acquisition is a core strategy for CommSoft. We are continuing to evaluate businesses with excellent scalable products in the CMS and CRM space where we can see potential to leverage our sales and channel strengths into significant revenue growth.”
“Brains will be totally integrated into the CommSoft family of shrink-wrapped, multi-platform telecommunications software products. It is expected that all Marketing Technologies staff will continue with CommSoft. All senior management will have three year employment contracts with CommSoft and will receive options as part of their remuneration packages. Brains product training begins immediately for our international sales force and will be concluded by the middle of February. We expect to be closing sales before the end of this financial year with significant contributions flowing in the next financial year.”
Brains – clients and services
Based in Auckland since 1994 and now with offices in Sydney and Melbourne, Brains is an award-winning CRM product with particular strengths in contact centre and relationship marketing.
Most current clients are based in Australia and New Zealand and include Toyota, Connect Interactive Business Systems (which provides call centre services for the Sydney Olympics, RAMS, AOL and Microsoft), Fosters Brewing Group, Global Loyalty (which provides loyalty programme management to Australian Credit Unions, MasterCard International and Westpac), U-Bix Document Solutions, the New Zealand and Australian Direct Marketing Associations and the Institute of International Research (in New Zealand , Australia, the United States and several European countries).
Marketing Technologies is recognised as a regional leader in CRM convergence with a focus on client-led research and development. Brains can be used from a WAP phone when sales and marketing personnel are in the field and need remote access. It is web-enabled, so is particularly simple to use for casual CRM users.
Brains powers the Call Centre of the Year in both Australia (Fosters Brewing Group won state Australian Teleservices Greenfield Centre of the Year 2000) and New Zealand (Toyota New Zealand won Teleperformance Grand Prix Customer Service Award 2000 and was runner up in the global awards held in Paris).
Brains also won the Saatchi and Saatchi/NZ Direct Marketing Association Gold Nexus award for Channel Management for 2000.
Brains supports multi servers and multiple databases including Oracle and Microsoft SQL Server concurrently, so that sales agents can share information across many divisions or organisations from a single desktop.
These benefits, when matched by CommSoft’s current CRM family of products and sales and channel capabilities, will enable CommSoft to offer a truly scaleable CRM system from SME to enterprise level and from traditional CRM operations to the latest technology.
“We spent considerable time evaluating how best to grow Brains into a truly global leader in CRM,” says Marketing Technologies Managing Director, Andrew Segar. “CommSoft’s record in product standardisation and sales force and channel strength persuaded us that this is simply the best way to secure a global and lasting future for our product.”
“We are also impressed by our cultural fit with CommSoft. Brains’ founders and directors are all have a technology and marketing background, a common trait with CommSoft.
Settlement details
CommSoft will pay NZ$3 million in cash and issue shares worth NZ$500,000 at A$1.10 per share on settlement. A further NZ$500,000 worth of shares will be issued after 12 months at the greater of the prevailing market price or A$1.10 per share. On the first anniversary after settlement, CommSoft will issue further shares worth NZ$750,000 if revenue targets are attained and on the second anniversary an additional NZ$1,000,000 worth of shares if further revenue targets are achieved. The issue price of the shares will be the greater of the prevailing market price or A$1.10. All shares are subject to a three year escrow arrangement. CommSoft does not need to seek shareholder approval for this transaction. The settlement date is Friday 19 January 2001.
CommSoft product family
CommSoft's two core lines of business are Communications Management Systems (CMS) and Customer Relationship Management (CRM) systems. Products include CallMaster, CallCentre, CTI Screen Pop and the NetMaster Internet management tool. CMS products help business managers to understand and control the increasing costs associated with the use of telecommunications. CRM software, such as a call centre solution, helps to attract and retain customers through improved customer management. In a recent study 80% of Fortune 500 CEOs ranked CRM as the single most important competitive advantage.
About CommSoft Group Limited
CommSoft Group Limited is an international leader in the development of niche software products for the telecommunications industry.
CommSoft develops and markets leading edge telecommunications software to help small to medium enterprises make better use of their telecommunications equipment through better cost management, increased staff productivity and improved customer service. Its products are bundled with products and services by some of the world's largest telecommunications suppliers.
More information on CommSoft is available on the web at www.commsoftgroup.com
About Marketing Technologies Limited
Marketing Technologies develops and sells Brains, the industry leading customer relationship management software. Brains is enabled for WAP, Web, Call Centres and Enterprise CRM. It has two platforms: Brains Enterprise for large businesses and corporates and Brains Express for individual and small businesses. Brains can be used for Consumer Marketing, Business to Business Marketing, Loyalty and Relationship Marketing, Customer Support, Direct Marketing, Call or Contact Center and Sales Force Automation. More information on Brains is available at www.brains.co.nz.
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