California Software to Acquire Hospitality Industry Software Provider

Joanna Doyle

California Software Corp. (Irvine, Calif.), a provider of AS/400 migration software, announced it has entered into a deal with MAI Systems Corp. to acquire MAI subsidiary Hospitality Information Systems (HIS, Irvine, Calif.), a software solutions vendor for the hospitality industry. The combined operations are expected to produce more than double the original projected revenues for California Software this year.

“The dominant market positions of California Software Corp. and Hotel Information Systems in their respective areas, as well as the shared knowledge of the IBM midrange and server markets, will allow a stronger, larger and consolidated company to move forward in achieving its goals of continued profitable growth,” says Bruce Acacio, chairman and CEO of California Software.

Brian Kretzmer, CEO of HIS, says the decision to merge with California Software developed out of discussions about how HIS could use California’s products to enable its AS/400 software to run on Windows 2000.

“HIS began discussions with California Software to utilize their BABY/AS 2000 and BABY GUI products to enable existing AS/400-based software to be deployable under Windows 2000 graphically,” Kretzmer says. “Through these discussions, the two companies found a shared synergy and we found our development teams and business strategies complemented each other well. It seemed that a discussion of a combined entity made sense.”

If the stock purchase agreement, scheduled to close later this month, is approved, HIS will operate as a subsidiary of California Software. MAI will receive approximately $26.8 million of California Software stock, and California Software will assume $9.5 million in MAI debt. MAI will become an HIS distributor and business partner.

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