Ongoing rumors that Nortel Networks would sell its Clarify CRM software unit to SAP AG turned out to be just that, rumors, after Nortel announced the sale of Clarify to Amdocs Ltd. Tuesday for $200 million in cash.
Amdocs is a provider of customer relationship management, billing and order management systems to communications companies as well as business support systems to directory publishing companies.
Under terms of the agreement, Amdocs bought all Clarify patents, intellectual property and trademarks and assumes existing customer contracts and leased office space.
The sale is part of Nortels ongoing plan to revive its sagging financial fortunes. The Toronto-based company, hit hard by the overall downturn in the telecommunications sector, reported a net loss of $19.4 billion in the second quarter.
"We are making excellent progress against the work plan we laid out earlier this year, and this sale of non-core assets is further evidence of that," said Frank Plastina, president of service provider and corporate networks at Nortel. "We continue to execute with speed and agility the streamlining of our business around our core markets to align our cost structure, and to strengthen our financial position."
Officials at St. Louis-based Amdocs said the acquisition positions the company as the leading provider of CRM software to the communications industry.
"The acquisition represents an excellent opportunity for Amdocs, enabling us to immediately leverage the significant potential in the communications CRM market," said Avi Naor, president and CEO of Amdocs. "A key component in Amdocs success has been our disciplined focus on communications. Similarly, in integrating with Clarify, we will be focusing our CRM activities and resources on the communications market."
Amdocs officials said the Clarify business would become tightly integrated into Amdocs new CRM division and the company would embrace a "partner-centric approach" to ensure continued support of existing Clarify customers.
Clarify, whose eFront Office suite is one of the most mature products on the CRM market, dates to 1990. Nortel acquired Clarify Inc. in March 2000 for stock valued at $2.1 billion at the time.
Amdocs acquisition of Clarify has already been approved by the boards of directors of both companies and is expected to close later this quarter, subject to regulatory approval.
Dennis Callaghan covers CRM and is at [email protected]