Epicor Software to buy European rival

The companies, which both cater to midsize businesses, announced the proposed buyout Friday. Epicor's offer consists of $41.7 million in cash and 4.1 million shares of its common stock. The companies expect to complete the acquisition, pending shareholder approval, by April.

Epicor, based in Irvine, Calif., competes with Microsoft, Lawson Software, and dozens of other software companies battling for prominence in the highly fragmented market of applications aimed at midsize businesses.

Epicor expects Amsterdam, Netherlands-based Scala to help it expand globally, particularly in Western Europe, Scandinavia, Russia, China, and Central and Eastern Europe. The combined company will have 20,000 customers and $250 million in annual revenue, Epicor said.

The deal follows a number of other recent acquisitions in the same market, including Siebel Systems' purchase of UpShot, PeopleSoft's acquisition of J.D. Edwards, the merger of Baan and SSA Global Technologies, and Best Software's buyout of Timberline Software.