Seite wählen

Vancouver, B.C. – November 14, 2003 – Pivotal
Corporation (Nasdaq: PVTL; TSX: PVT), today announced that the
Special Committee of the Board of Directors of Pivotal Corporation
has recommended to the Board that it not support the proposal of
Onyx Software Corporation (NASDAQ: ONXS) delivered to the Board and
the Special Committee on November 12, 2003. The Board of Directors
has accepted this recommendation, and its decision has been
communicated to Onyx Software Corporation. This press release sets
out the reasons for the Board’s decision.

Background to Current Situation
The Management Information Circular of Pivotal dated October 21,
2003 (the “Information Circular”) contains a
description of the reasons for, and the process involved in,
Pivotal’s search for a transaction that would maximize value
for shareholders. The Information Circular describes the
Board’s assessment of Pivotal’s strategic plan in light
of the competitive environment developing in the customer
relationship management software sector and the state of the
capital markets as a source of financing for Pivotal. The
Board’s consensus was that companies of Pivotal’s size
and resources faced a challenging future unless they were able to
achieve growth and synergies through business combinations, or
obtain access to capital on favourable terms in order to finance
growth. The Board determined that unless Pivotal were to pursue one
or both of those alternatives, shareholder value could be further
eroded. The Information Circular describes the extensive process
under which the Oak Group was selected as the bidder that produced
the best opportunity for maximizing value for shareholders of

In the process of identifying potential bidders, Onyx Software
was not asked by RBC Dain Rauscher Inc. (“RBC”), the
financial advisors to Pivotal, to submit a proposal. The reason for
this was that previous discussions between Onyx and Pivotal had
convinced Pivotal that a merger with Onyx would not produce a
stronger combined entity, and would therefore risk further eroding
value for Pivotal shareholders. Notwithstanding that fact, Onyx was
clearly aware that Pivotal was considering strategic alternatives
but did not approach Pivotal with any proposals. Even after the
time that Pivotal announced the Oak/Talisma transaction on October
7, 2003, Pivotal received no communications or expressions of
interest from Onyx concerning a possible transaction until
Onyx’s proposal was announced on November 12, 2003, just four
business days prior to the meeting of Pivotal security holders to
approve the Oak/Talisma transaction.

Pivotal’s Response to Onyx Proposal
Since receiving Onyx’s proposal, the Special Committee has
met three times with its financial and legal advisors and once with
the Board of Directors to review the proposal and the publicly
available information concerning Onyx, and to assess the risks,
costs and benefits of pursuing further discussions with Onyx
regarding a transaction along the lines outlined in their proposal.
The unanimous recommendation of the Special Committee, which was
accepted by the Board, was that such a transaction would not be in
the best interests of Pivotal or its shareholders, and that the
proposal was not considered one which would be reasonably likely to
result in a “superior transaction”, thereby entitling
Pivotal, under the terms of the Arrangement Agreement between
Pivotal and the Oak Group and Talisma Corp., to enter into further
discussions with Onyx.

In reaching its recommendation, the Special Committee, with the
assistance of its financial and legal advisors, considered a
variety of factors relating to Onyx itself, the prospects for a
combined Pivotal/Onyx entity, and closing, market and timing risks
associated with Onyx’s proposal. The Special Committee
considered no single factor to be determinative in the formation of
its recommendation, although certain aspects, such as the absence
of an actual offer, the comparison of a proposal involving shares
of fluctuating value and liquidity to an existing agreement for a
fixed cash price, and the questionable profile and capitalization
of a merged Pivotal/Onyx entity, were constantly reinforced by
other factors that the Special Committee considered, some of which
are identified below.

Onyx is Not an Attractive Merger Partner for Pivotal
The Special Committee’s considerations included the following
aspects of Onyx as a potential cashless merger partner:

  • the volatility and relative illiquidity of Onyx stock
  • the fact that the Onyx share price has underperformed both the
    NASDAQ and the Pivotal share price over the last 12 months
  • Onyx’s apparent limited access to capital on favourable
    terms as demonstrated in its recent financing history
  • Onyx’s history of small acquisitions and apparent absence
    of experience in completing larger transactions and the integration
    issues associated therewith
  • Outstanding litigation involving Onyx (including shareholder
    class actions which allege, among other things, violations of
    applicable securities laws) with unpredictable consequences that
    could include significant depletion of Onyx’s cash
  • Onyx’s inconsistent performance against short term and
    long term equity research analysts’ estimates
  • The low licence to service mix in Onyx’s revenue
  • The fact that Onyx is not currently profitable
  • The generally neutral or negative research sentiment of equity
    research analysts’ coverage of Onyx
  • The fact that Onyx’s cash position is not attractive, and
    the fact that it has committed a significant amount of its
    available cash to ongoing restructurings and to secure letters of

A Merged Pivotal/Onyx Would Not Be An Attractive

The Special Committee also considered the implications for a merged
Pivotal/Onyx entity including:

  • Questionable synergies compared with significant and inevitable
    cash costs of combining and integrating the two entities
  • the depletion of the combined entities cash resources as a
    result of costs of completing the transaction, including payment of
    a $1.5 million break fee to Oak
  • The potential loss of customers as evidenced by a number of
    strong and unsolicited expressions of concern Pivotal has already
    received from its customers concerning a merger with Onyx, and no
    customer expressions of support
  • The absence of a significant “financial sponsor”
    for the merged entity and the prospect for limited access to
    attractively priced capital in the near term
  • The considerable amount of redundancy between product lines
    which is likely to result in few cross-selling revenue synergies
    and is likely to lead to either higher costs to support products or
    customer attrition if one product line is favoured over the
  • No indications of who would manage or direct the combined
    entity or whether any board seats would specifically be designated
    for representatives of Pivotal’s shareholders
  • The prospect that the need for management of both companies to
    focus on structuring and completing a transaction for an extended
    period of time and the market uncertainty during that period could
    have a significant negative impact on the business of Pivotal and
    Onyx, leaving the resulting entity in a weaker competitive and
    financial position
  • As a result of all of the above, the questionable value of the
    securities of a merged Pivotal/Onyx entity post-closing

The Onyx Proposal is Subject to Significant Risks
The Committee also considered the specific aspects of the Onyx
proposal, including:

  • The fact that Onyx has delivered only a cursory preliminary
    proposal rather than an offer that can be considered in its
  • The market risk associated with a fixed share exchange ratio,
    as evidenced by the erosion of the indicated value of the proposal
    immediately after its announcement
  • The time and expense required for each of Pivotal and Onyx to
    satisfy their respective “due diligence” requirements,
    and the uncertainty inherent in that process
  • The possible requirement for Onyx shareholder and regulatory
    approvals, which creates further delay, expense and
  • The time delay, uncertainty and risk of closing arising from
    the necessity to negotiate, receive all necessary approvals for,
    and consummate a cashless “merger of equals”
  • The poor prospect for liquidity for Pivotal shareholders, who
    would hold almost one half of the shares of a combined entity
  • The tax deferral aspects of the proposal in the context of
    Pivotal’s shareholder profile and the costs associated with
    structuring the transaction to achieve such a deferral

In weighing all of the above factors, the Special Committee,
with the assistance of its financial and legal advisors, concluded
that Onyx’s proposal was not reasonably likely to result in a
superior transaction which it could support. Accordingly, the
Special Committee has today communicated its conclusion to Onyx,
and has indicated that under the terms of the Arrangement Agreement
with the Oak Group and Talisma Corp., it will decline to enter into
negotiations or discussions with Onyx with respect to its

Full details of the arrangement of the proposed arrangement
involving Oak and Talisma can be found in the Information Circular,
which is available free of charge from Pivotal, on our website, on
the SEDAR website ( and on the U.S. Securities and
Exchange Commission’s EDGAR system (

About Pivotal Corporation
Pivotal Corporation is the only CRM company that is 100 percent
purpose-built to serve the demanding requirements of mid-sized
enterprises – a powerful, highly flexible application
platform, a complete set of CRM applications, and low-cost,
results-producing implementation services. Pivotal delivers
software and services that produce meaningful increases in
revenues, margins and customer loyalty for companies and business
units in the revenue range of $100 million to $3 billion. More than
1,600 companies around the world have licensed Pivotal including:
CIBC, Centex Homes, Farm Credit Services of America, HarperCollins
Publishers, Hitachi Telecom Inc., Palm, Inc., Pharmacia
Corporation, Premera Blue Cross, Royal Bank of Canada, Sharp
Electronics Corporation, Southern Company, Vivendi and WebEx

Pivotal’s complete CRM software suite includes a powerful
application platform and capabilities in marketing, sales, service,
contact centers, partner management and interactive selling. For
more information, visit

Forward Looking Statements
This press release contains forward-looking statements, including
those relating to the outlook and prospects for Pivotal’s
business, the upcoming meeting of Pivotal shareholders to consider
the plan of arrangement, the outlook and prospects for Onyx’s
business and for the business of any combined company that might
result from Onyx’s proposal and closing, market and timing
risks associated with Onyx’s proposal. Forward-looking
statements include statements about plans and proposals for future
actions, or events or conditions that may occur in the future. The
words „believe,“ „expect,“ „intend,“ „anticipate,“ variations of
such words, and similar expressions identify forward-looking
statements, but their absence does not mean that a statement is not
forward-looking. Forward-looking statements are based on the
opinions and estimates of management at the time the statements are
made and are subject to risks and uncertainties and other factors
that could cause actual events, conditions or results to differ
materially from those anticipated in the forward-looking
statements. These risks, uncertainties and other factors include,
among others, customer preferences regarding the software products
marketed by Pivotal and Onyx, competition from present and future
product offerings of third parties, the strength of the North
American and world economy in general and the market for business
software products in particular, and conditions in the capital
markets and availability of financing. Pivotal undertakes no
obligation to update publicly any forward-looking statements to
reflect new information, events or circumstances after the date of
this release or to reflect the occurrence of unanticipated