New accounting compliance ally gives CDC entrée to untapped industries such as high tech and business services.
CDC Software, a purveyor of enterprise software, today announced plans to form a joint venture with Softrax Corp., a provider of billing and revenue management software, in a move to expand CDC Software’s compliance offerings and extend Softrax’s geographic reach.
The venture, which is expected to be up and running in the third quarter, will team up CDC Software’s India- and China-based product engineering and customer and technical support resources with Softrax’s domain and product expertise in the financial compliance arena, the companies said in announcing the agreement.
“Softrax offers two key product lines for enterprise and mid-market, but the lion’s share of the business is in the mid-market,” a CDC Software spokeswoman told Manufacturing Executive. The mid-market is CDC Software’s bread-and-butter segment.
The two companies will sell to each other’s customer base, enabling CDC to get a foot in the door at high tech and business services companies — Softrax’s primary markets — and other companies that must meet the requirements of Sarbanes-Oxley and other Financial Accounting Standards Board (FASB) regulations. The companies are also “exploring opportunities to embed their technologies into each other’s products to facilitate integration,” according to the announcement. Specifically, CDC’s spokeswoman said, CDC is targeting its Pivotal CRM and Ross Enterprise product lines.
“As a long-time customer of Softrax, we know firsthand the strategic value and insight their solutions deliver to a company’s compliance and revenue management processes,” said Bruce Cameron, president of CDC Software, in the announcement.
CDC Software, for now a wholly owned subsidiary of CDC Corp., supports product compliance through its Ross Enterprise products that cover regulatory requirements for the food and beverage, life sciences, and chemical industries, and environment health and safety requirements through a partnership with 3E Co. The alliance will extend its compliance capabilities into the financial realm, the company said.
The company, like nearly every other technology vendor, has felt the effects of the recession in recent quarters. Most recently, it reported a 17% decline in revenue, to $50.5 million, for its first quarter ended March 31. The company has been pursuing “strategic growth alternatives,” which of late have included acquisitions, such as manufacturing intelligence software provider Informance International and U.K.-based Categoric, which offers supply chain event management and business activity monitoring software.
