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Acquisition of Danish competitor expected to bring more jobs to Fargo

Microsoft Great Plains is about to get bigger in a big way. The Fargo-based business software company will grow globally -- by nearly a third -- when its parent company, Microsoft Corp., acquires Danish competitor Navision. Microsoft Corp., of Re...

Microsoft Great Plains is about to get bigger in a big way.

The Fargo-based business software company will grow globally -- by nearly a third -- when its parent company, Microsoft Corp., acquires Danish competitor Navision.

Microsoft Corp., of Redmond, Wash., will pay $1.3 billion for the company in a deal that closes in August. Microsoft will roll the company into its Microsoft Great Plains division.

Company officials said the acquisition puts Microsoft Great Plains in position to strengthen its presence in the European business community's software market and opens the door for new job opportunities in Fargo.

The acquisition adds 1,300 employees to the Microsoft Great Plains division of Microsoft. With some 3,800 employees nationwide -- including more than 1,000 in Fargo -- Microsoft Great Plains becomes one of the largest Microsoft divisions through the deal, according to Tami Reller, Microsoft Great Plains corporate vice president for business solutions.

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"Fargo and Redmond will be pillar locations for business solutions," Reller said. Of more than 200 current job openings in the business development area, 30 percent are in Fargo, she said.

"We should see significant growth in Fargo," she said. "There are a lot of opportunities for team members created by this."

Reller said the acquisition demonstrates a strong commitment from Microsoft to its Great Plains division, one of seven within the company. Microsoft's other divisions are: Windows for PCs, Knowledge Works, MSN, Mobile Products, Home and Entertainment and Servers and Programming Tools.

Microsoft Great Plains and Navision develop and market software and online business applications used by midsized companies. In the case of Microsoft Great Plains, that means companies ranging from $1 million to $800 million in annual revenue.

Microsoft Great Plains now dominates the United States in that range. In fact, Microsoft Great Plains generates 86 percent of its revenue in North America.

"Navision is just the opposite. They do just 10 percent of their business here," Reller said. "The rest of their business is global -- mostly in Europe."

Microsoft Great Plains President Doug Burgum flew to Navision's home in Copenhagen, Denmark, to announce the stock-and-cash acquisition.

"Microsoft and Navision have had parallel lives, each with a deep belief in building long-term customer relationships achieved through lasting commitment to talented, value-adding partners," Burgum said at a news conference in Copenhagen.

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The deal will be Microsoft Corp.'s largest acquisition since Fargo-born-and-raised Great Plains Software in December of 2000 for $1.1 billion.

Jodi Uecker-Rust, Microsoft Great Plains chief operating officer and vice president for global operations, was instrumental in sealing the deal with Navision, according to Reller. Uecker-Rust moved from Fargo to London a year ago to concentrate on the company's global efforts.

"Navision is a very strong, solid company that had been emerging as a competitor in the United States," Reller said. She said Navision complements Microsoft Great Plains both geographically and in product lines.

Microsoft offered Navision shareholders $37 per share or Microsoft shares based on a specified exchange ratio, according to a news release. Navision said its board was unanimously recommending that shareholders accept the offer.

Navision's key management, including co-CEOs Preben Damgaard and Jesper Balser, will remain with the merged company. Balser will become director of global strategy while Damgaard will be director of Middle East, European and African operations.

"Navision's success is built upon a deep understanding of customer needs that is delivered through an extensive local partner network," said Damgaard.

While Great Plains also has a global reach -- its products are used by businesses in more than 130 nations -- Navision is better positioned internationally, particularly since the advent of the Euro as the accepted form of currency in Europe.

"They have done an important job in defining, translating and localizing solutions," Reller said. "They are particularly strong in Denmark, of course, and Germany, France, Spain and Italy. More and more mid-sized companies there are needing new systems, and the euro is one of the reasons for that."

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Navision sells applications for enterprise resource planning as well as customer relationship and knowledge management.

Customer relationship management, or CRM, allows a company to keep track of its entire relationship with a customer. In addition to recording purchases and notifying users of a customer's service needs, it can link to a company's financial catalog to provide sales estimates, discounts and cross-promotions, and can be used to create a marketing database based on customers' buying habits.

Reller said Navision's software research and development teams will be working with Microsoft Great Plains teams in Fargo, Redmond and Boston in developing new business products for the Microsoft dot.net business application. That application works through Microsoft's bCentral platform, a Web site for small- and mid-sized businesses.

"We have been investing heavily in that, and now we have a strong presence in all of the high-tech spots in the United States, including Fargo. Once we're together, Navation becomes our European operation for research and development," Reller said.

Readers can reach Forum Business Editor Gerry Gilmour at (701) 241-5560

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