CDC Corporation proposes merging CRM vendor Onyx Software with its CDC Software

CDC Corporation, a Chinese concern, announced last week that CDC Software, a wholly owned subsidiary of CDC, made a proposal to officers and directors of CRM vendor Onyx Software that would result in a merger of the Onyx Software CDC Software.

A response from Onyx is still pending although it is generally understood that Onyx said it is reviewing the proposal. The proposed terms and conditions of the CDC’s offer provide for each Onyx shareholder to exercise an option to receive either cash only or cash and shares for an interest in CDC Corporation.

An executive for CDC Corporation admits that CDC Software is desirous of acquiring Onyx specifically for its Pivotal CRM division.

In January of this year, CDC had submitted a similar proposal to Onyx but the response was not an encouraging one. That said, CDC is making a comeback with the revised proposal.

The previous offer proposed the merging of all assets belonging to both CDC Software and Onyx. Additionally CDC offered to pay Onyx $50 million in cash, for a majority of Onyx’s common stock while keeping Onyx a publicly-listed company. Onyx’s management turned the offer down.

The offer was purportedly refused because: the assets of CDC Software are not performing satisfactorily; CDC’s history of profitable operations is inconsistent and the corporation’s record of delivering shareholder value is poor

Last week, CDC announced that they were forming another board of directors, which would target growth initiatives with the object of making the corporation an independent entity.