SoftwareOne this morning headed off weeks of press speculation by confirming it intends to buy rival Crayon.
The SIX Swiss-listed software licensing giant announced it will launch a recommended voluntary stock and cash offer valuing its Oslo-listed peer at $1.4bn.
The move, which has the backing of both SoftwareOne and Crayon’s founding shareholders, would create a pan-European software licensing and cloud powerhouse with 13,000 employees.
It is set to complete in Q3 of 2025.
IT Channel Oxygen joined this morning’s analyst and press call to sift out some hidden nuggets from the potential deal. Here’s what we caught in our pan…
1. An $18bn monster
On a trailing 12-month basis, the duo boast combined revenues of 1.595bn Swiss francs ($1.78bn) – with SoftwareOne contributing 1.037bn Swiss francs of that, and Crayon 557m Swiss francs.
These figures do little justice to their invoiced sales, however, with the pair revealing on the call that combined gross billings will stand at 15.8bn Swiss francs ($17.7bn).
They claim they are serving a $150bn market that’s growing in the mid-teens (driven by trends such as public cloud adoption and AI).
The duo have identified run-rate cost synergies of CHF 80-100m within 18 months of completion.
2. Microsoft is 70% of its business
Everyone knows SoftwareOne and Crayon are strong with Microsoft, but how strong?
On the call, Crayon CEO Melissa Mulholland revealed that Microsoft would generate “approximately” 70% of the combined company’s revenues.
It would have around one million Microsoft Copilot users, and 7,000 Microsoft certifications.
With Microsoft known to be aggressively chopping partner incentives on Enterprise Agreements from January, and moving them into other areas such as CSP (see here, here and here), could that be seen as a negative?
Addressing this point indirectly, Mulholland emphasised Crayon’s strength in CSP .
“We’ve built a very strong channel business that leads in CSP,” said Mulholland, who will become co-CEO of the combined company alongside her SoftwareOne counterpart Rafael Erb.
“When CSP launched in 2015 for Microsoft, we decided to build out that channel motion, which is our most profitable business today, and will continue to be a strength, especially in regards to the changes Microsoft are making.”
3. Crayon CEO reveals its true colours
Geographically speaking, SoftwareOne and Crayon’s main stomping grounds are the Nordics and DACH, respectively. Outside of EMEA, SoftwareOne is larger in North America, whereas Crayon is (relatively) larger in AsiaPac.
Crayon also has more of an SMB and channel bent than its more large-enterprise-focused, direct-selling peer.
“Crayon itself does not have a lot of large enterprise customers. Our strength is in midmarket, all the way down into SMB,” Mulholland said.
“If you look at the enterprise capability that SoftwareOne has through its marketplace and its ability to serve 7,000 different providers, that will give us strength and certifications, and new ways to attract net new customers, and expand and upsell. We see that as a great opportunity from the Crayon side.
“And equally from the SoftwareOne side, our CSP strength and the strength of channel will also be a new endeavour to take forward.”
4. Double U-turn explained
Having acquired a shareholding in Crayon in 2018, SoftwareOne then reduced its stake in 2022. Now it wants to buy the whole thing.
When asked about this apparent double U-turn on the call, SoftwareOne CFO Rodolfo Savitzky said this sequence of events proves only that “the attractiveness of the combination was always there”.
“The value of the shares increased significantly and at one point we decided to partially monetise the shares,” he said.
“We are seeing the happy conclusion of an idea that started way back when we initially acquired the shares.”
5. Go-private plans in the long grass
The deal appears to draw a line under SoftwareOne’s 18-month flirtation with potentially selling up itself (it was still mooting go-private options as recently as last month).
On the call, Erb left the door open to a potential ownership change at some point in the future, however.
“Joining forces [with Crayon] is the right thing to do for all stakeholders,” he said.
“We are convinced the business combination with Crayon represents a significant value creation opportunity for shareholders, and therefore the company will now focus all its efforts on the successful completion of the transaction and integration.
“The board does not rule out considering private ownership at a later stage.”
