Commentary on Tagetik Acquisition

Tagetik Acquisition by Wolters Kluwer
Craig Schiff , President and CEO, BPM Partners

Products
Tagetik, a leading corporate performance management (CPM) vendor has signed an agreement to be acquired by Wolters Kluwer, a much larger software and professional services firm. One of our concerns in most mergers and acquisitions in this industry is the fate of overlapping product lines. Typically some products get sunsetted leaving those customers in the lurch, or the vendors spend an inordinate amount of time merging products to create a new product that everyone needs to eventually migrate to. Fortunately, that will not be the case here as there is little to no overlap. As a matter of fact, the two companies offer complementary products. Tagetik brings a comprehensive corporate performance management solution to the table, while Wolters Kluwer has offerings for audit and tax. These solutions will be combined into a new Corporate Performance Solutions (CPS) business unit in the Wolters Kluwer Tax & Accounting Division. The renamed product, CCH Tagetik, will join TeamMate (audit) and corporate tax products in this business. The intent is to provide a full range of solutions to the office of the CFO starting from the output of ERP systems to final disclosure. Existing customers of Tagetik will now have additional products available to expand their capabilities, although for now there are no announced integration plans.

Operations
From an operational perspective these acquisitions often result in high personnel turnover, or at least months of distraction as the two vendors try to integrate their organizations. In this instance Tagetik will continue to run as a self-contained entity within the new CPS business unit. Senior Tagetik management is planning to stay on, as are the current co-CEOs and original founder of the company. Minimal turnover of the rest of the staff is anticipated and no staffing cuts are currently planned. Things could always change, but as of now it appears that there will be minimal disruption to Tagetik’s day to day operations.

Final Thoughts
Tagetik has always run fairly lean which has resulted in missed sales opportunities due to limited coverage as well as in some instances of being short-handed on the implementation side during periods of rapid growth. Having the significant resources of Wolters Kluwer available to Tagetik should help in these areas. From a geographic perspective the Tagetik business has had a European focus while Wolters Kluwer tax and accounting has had a North American one. The two vendors working together, and combining their offices around the world, should be able to expand the global reach for all of their products.

While anything could happen, we are cautiously optimistic that both companies as well as their customers and prospects will benefit from this merger.