FrontRange Solutions to be acquired by Francisco Partners for approximately $200M (email this article)

DUBLIN, CA (November 3, 2005) FrontRange Solutions Inc. (Company Profile, Past Stories, Case Studies), a global leader in service management, CRM, and voice application solutions for the small-to-medium-enterprise (SME) and distributed enterprise markets, announced today that Francisco Partners, one of the world’s largest technology-focused private equity funds, has agreed to acquire all of its outstanding shares in a transaction valued at approximately $200M.

According to FrontRange CEO Michael McCloskey, “FrontRange Solutions has out-performed the industry for the last two years, growing at a rate that far exceeds our competition. During this period, we have invested heavily in both R&D and sales expansion, while continuing to increase our profitability. With several new products coming to market, we are well-positioned for continued growth, and plan to increase our market share.”

McCloskey continued, “The acquisition by Francisco Partners reflects the tremendous progress we have made during the past 24 months in reshaping FrontRange into a leading provider of service management, CRM, and voice applications. This further ratifies our strategy of providing valued solutions to our customers, and is the next step in building a global market leader.”

Neil Garfinkel, a Managing Director of Francisco Partners, added, “We are pleased to become an investor in FrontRange and look forward to working with Michael and the rest of the management team in the coming years. FrontRange has a strong market position, great product franchises that are being improved by advanced technology, over 140,000 customers, and a global partner channel that provides broad market coverage. We believe the company is poised to deliver significant growth over the next several years.”

“This investment by such a respected firm is good for FrontRange and its employees, customers and partners,” said Sheryl Kingstone, Senior CRM Analyst with The Yankee Group. “FrontRange has performed well in the last two years and in conjunction with Francisco Partners we would expect them to pursue an aggressive growth strategy. Customers and prospects should expect the following: market expansion, innovation, and potential acquisitions.”

Gary Greenfield, an Operating Partner of Francisco Partners and former CEO of Peregrine Systems continued, “I have been very impressed with FrontRange’s new family of solutions—in particular, the newly released ITSM product family provides the company with a product that is the most advanced on the market today. This new family of products should allow FrontRange to extend its leadership in its current markets, and gain share in the distributed enterprise market.”

John Ragsdale, analyst of Forrester Research added, “The most significant vendor events in the service desk and CRM arena in 2005/6 may not be from the enterprise-level players, but from the mid-market. The release of FrontRange enterprise editions of HEAT® and GoldMine®, on a .NET platform, includes surprisingly complex functionality all for a single price. With this much capability available for half the list price of enterprise vendors or less, expect the overall deal size of service desk software to go down.”

Summarizing, McCloskey said, “This investment by Francisco Partners will enable FrontRange Solutions to continue to pursue our aggressive growth strategy. We are committed to providing our Customers and partners with market leading products and superior service and support. This investment further strengthens that commitment”.

The transaction is expected to close in approximately 90 days, and is subject to approval by FrontRange shareholders and customary closing conditions.

About Francisco Partners
With $2.5 billion of committed capital, Francisco Partners is one of the world's largest technology-focused private equity funds. The firm was founded to pursue structured investments in technology companies undergoing strategic, technological, and operational inflection points. Francisco Partners targets majority and minority investments in private companies, public companies, and divisions of public companies, with transaction values ranging from $30 million to $2.0 billion. The principals of Francisco Partners have a proven track record, having invested in excess of $3.0 billion of equity capital in over 50 technology companies. For additional information, visit www.franciscopartners.com.

About FrontRange Solutions
FrontRange Solutions develops award-winning software and solutions used by more than 130,000 companies and over 1.2 million users worldwide to manage a wide variety of business relationships and provide exceptional service. FrontRange product families, designed specifically for small-to-medium-enterprise (SME) and distributed enterprise organizations include: GoldMine® for business relationship management, team-based contact management and sales force automation solutions; IT Service Management with HEAT® and ITIL® standards-based modules for complete service management; Communication Management including IP Contact Center for reduced telephony costs and increased agent productivity, streamlined customer service and communications; and Infrastructure Management, which provides the ability to optimize the full lifecycle of a company’s assets. Customers representing 44 percent of the Fortune 100 and 76 percent of the FTSE 100, include Coca-Cola, Shell Oil, Prudential Securities, Électricité de France, Mack Trucks, Campbell Soup, Avaya, Bechtel Corp, Bank of America, and Turner News Network. For more information, call (800) 776-7889 or visit www.frontrange.com. GoldMine, HEAT and other FrontRange Solutions products, brands and trademarks are property of FrontRange Solutions USA Inc. and/or its affiliates in the United States and/or other countries. Other products, brands and trademarks are property of their respective owners/companies.