Takeover will help "maintain lead" says Staffware chief

John O'Connell, Staffware's chairman and CEO, told silicon that the takeover by US-based Tibco would help the combined company to "maintain and lengthen our lead" over software majors such as Microsoft, IBM and BEA.

"They're good at doing a lot of things reasonably well and we're specialists," he said. "We work well with them, mostly – without them we wouldn't have a business."

O'Connell said that Staffware had been considering various options for expansion in the US when Tibco made an approach which had been tipped by some analysts such as Ovum. Today, the company made a £123m cash-and-share offer for the company.

And, while 90 per cent to 95 per cent of Staffware employees have either shares or options, O'Connell said he would be surprised if any more than a handful cashed in and left. "We're looking to grow the company – we are both growing companies, profitable, cash in the bank and in a growing market," he said.

And he can't see too much staff overlap between the two companies. "We are both expanding and we have a shortage of staff. Anybody looking spare will be quickly re-assigned. Neither of us was known for needless and lavish offices," he said.

Integration of the two companies' software products would be funded out of their R&D budgets. Both of these have traditionally been high, with Staffware's currently standing at 18 per cent and Tibco's at 24 per cent of sales.

O'Connell himself will become head of business process management for the combined company. "I look forward to dropping out of the public company role. It takes a lot of time away from the company and the customers," he said.

O'Connell owns just under 10 per cent of the Staffware shares.

Tibco could reasonably be called the original middleware company but until its recent move into the BPM market it had been suffering in competition with the software majors. Its former parent Reuters has let its holding drop down to 20 per cent.

Staffware has been one of the great survivors of the British software industry; growing steadily, but never quite achieving the success it would have liked. It has a worldwide presence but lacked the size to get more than a toehold in the all-important US market.