Open Text acquires Corechange for $3.6 million

Intranet software maker Open Text Corp. has acquired enterprise portals developer Corechange Inc., whose technology Open Text plans to integrate with its own Livelink product, the companies said Wednesday.

Open Text paid US$3.6 million in cash for Corechange, according to a regulatory filing, with additional cash payments possible based on Corechange's revenue during the next year.

Corechange, in Boston, is the developer of Coreport, a software product that can be used for internal and external portal systems integrating corporate documents, applications and services. Waterloo, Ontario-based Open Text intends to mesh Coreport with its Livelink collaboration and knowledge management software, which includes document storage, discussion, search, scheduling and workflow management features.

Open Text will continue supporting Coreport's 150 customers and selling Coreport as a stand-alone product, said Bill Forquer, Open Text's senior vice president of business development. It will also boost Coreport's connections with Livelink, and draw on the Corechange staff's experience with portals to enhance Livelink's content integration features, he said.

Analysts have been predicting imminent consolidation in the fragmented market for enterprise portal software. With major vendors such as Oracle Corp., IBM Corp. and PeopleSoft Inc. competing in the market, only one or two pure-play developers are likely to survive, Jupitermedia Corp.'s research unit said in a recent report.

Corechange suffered as customers began moving away from niche vendors, Forquer said.

"Increasingly, we think most customers prefer to get their portal from their content management and collaboration vendor or their infrastructure supplier," he said.

Of Corechange's 75 employees, 35 will move to Open Text, according to Forquer. Layoffs will come primarily from Corechange's marketing, finance and administrative departments, he said. Open Text plans to keep Corechange's staff in Boston and create an Open Text office in the city.

Open Text has recently purchased several other companies to integrate their technology with Livelink. It agreed in January to pay up to US$6.7 million for sales software maker Eloquent Inc., and in November spent US$20.3 million to buy unified communications software developer Centrinity Inc.

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