Red Hat turns to eSec for security

Red Hat, one of the leaders in the Linux open source operating system arena, has entered an alliance with Australian e-security specialist eSec, which will offer its managed security services on Red Hat Linux-powered platforms.

Under the terms of the deal eSec's security services will be offered to Red Hat customers worldwide. Red Hat will provide engineering and technical support services and offer packages as an "enterprise-ready solution".

"We recognised that eSec has developed an innovative and valuable service for businesses and are very excited about the potential of this partnership," said Mark White, vice president and general manager of Red Hat Asia/Pacific. "Information security is a fundamental business requirement, but it is becoming too complex and expensive to adequately perform inhouse," he added.

Saxon Hill, CEO of eSec said his company recognised the strategic importance of open source software and was delighted to be working with Red Hat. "Linux is the fastest-growing server operating system and Red Hat is the undisputed Linux market leader," he acknowledged.

Catuity forges smart links with Gemplus

Hot on the heals of its appointment last month as supplier of loyalty software for Visa's new smart card platform, Australian company Catuity has entered a technology partner agreement with Gemplus, which a spokesman described as "the world's leading provider of smart card-based solutions".

Both companies are supporting the smart Visa Program, and Catuity has already augmented its loyalty system with the GemXpresso cards and other offerings. Mike Howe, president and CEO of Catuity, acknowledged that the potential opportunity of the Visa and Gemplus deals is "huge, both for the US and worldwide".

MYOB granted MSC status in Malaysia

Australian accounting software developer MYOB has been granted the status of a Malaysian Multimedia Super Corridor company, enabling it to enjoy significant benefits, including permission for 100 per cent foreign ownership and a five year tax holiday.

As if to celebrate, the company has also bought SeaSoft Computer Services, which has been a distributor of MYOB products in Kuala Lumpur for more than seven years. SeaSoft was founded in 1990 by Fred Baker and now has a staff of 30. In the wake of the takeover Baker will become general manager of MYOB Asia.

"The acquisition of SeaSoft will provide great benefits," explained Craig Winkler, CEO of MYOB. "The staff of both companies have worked together successfully over a number of years and the direct presence bolsters our resources in the Asian markets."

The acquisition will be funded by a payment of $A1.15 million in cash and the issue of options over shares in MYOB.

IBA buys British health business

Australian health information systems company IBA Technologies, which listed on the ASX in March, has agreed to buy the managed services arm of British company Hyder plc, along with four existing contracts wroth $A17.3 million over terms of five or six years. A spokesman explained that the acquisition covers Hyder's managed services business in patient administration and clinical systems for the UK National Health Service.

In addition to the acquisition, the two companies will work together to win contracts in the UK health sector.

"This is a significant milestone for IBA," noted executive chairman Gary Cohen. "The acquisition and strategic partnership with Hyder will make us even more competitive, further raise our profile in the UK marketplace, and create a platform upon which we can continue to build a substantial health IT outsourcing business in Britain, Asia, and Australia.

"The major new IT tenders in the NHS are not just for software, where we have an almost unique offering of clinical and administrative solutions, but for packaged services effectively running all or part of the IT infrastructure for hospital groups. We can now offer these services to our existing customers as prime contractor," he concluded.

Cellnet buys IT distributor

Mobile phone distributor Cellnet Telecommunications has bought Brisbane computer distributor IT Wholesalers in a deal valued at about $A7 million. IT Wholesalers distributes IBM and Acer laptop computers, as well as products from Lexmark, Epson, Panasonic and Brother. It has a national client base of resellers and generated about $A39 million in the 1999/2000 financial year.

Mel Brookman, managing director of Cellnet, said the acquisition opened new opportunities for the companies. "While the acquisition has appeal given the opportunities for integration of distribution and support functions, more importantly it gives Cellnet a unique position in two converging markets," he explained. "Based on current levels of activity we expect sales for the current year to be of the order of $A50 million."

Business briefs

Recently listed developer Oakton Computing has bought IT strategy and architecture consulting firm Charter Wilson & Associates for $A5 million in cash and shares. Charter Wilson will operate as an independent subsidiary from its existing premises in Melbourne.

Inprise/Borland and CiTR have formed a partnership to fill the demand for Internet portals within the Australian government sector. A spokesman said the alliance intends to develop, implement, host and maintain at least 10 government portals by mid-2001. The business will rely heavily on CiTR's DECADE AccessPoint IT platform to speed the process of portal development, the spokesman explained.

Billing software developer Phoneware has acquired CTI International for $A1.44 million. With the purchase goes the Billit software, which provides a single standard interface to a range of separate billing management products. CTI has a strong presence in the government sector, but Phoneware intends to offer Billit to a range of new corporate and government customers.

Listed property services company CBD Online has acquired Sydney e-commerce developer Halescom in a progressive share swap that could be valued as high as $A23 million. A down payment of $A11.2 million will be made in December 2000, and further issues of shares worth up to $A12 million will be made in 2002, subject to achievement of specified profitability levels. Tony Tregurtha, CEO of Halescom, will become CEO of CBD Online, while Antony Hing, current managing director, will rejoin Davnet in Hong Kong.

Davnet has lifted its holding in Hong Kong joint venture DDHK Partnership from 66 per cent to 83 per cent by acquiring the stake of Netpolis Hong Kong. A spokesman said the change simplifies Davnet's corporate structure and allows for a speedier introduction of broadband solutions to business users in Hong Kong and other parts of the region.

Corporate quarters

Things look grim for a significant sector of the IT industry, according to the number of companies warning investors this week that the next set of numbers won't be a pretty as they ought. This week's warnings included:

Lucent Technologies, which has revised its profit forecasts downward by 25 per cent. Revenue for the quarter is expected to rise by about 15 per cent to around $US9.4 billion. For the full year Lucent expects overall profit to be 10 or 11 per cent lower than in the previous year, while revenue will rise about 14 per cent.

StorageTek thinks it might be profitable in its third quarter to September 30, although revenue will be reduced to somewhere between $US465 million and $US480 million. The profit shortfall was attributed to availability problems with the 9840 tape drive, which have since been resolved.

Silicon Graphics expects to lose about 28 cents or 30 cents a share despite realising about $US50 million from the sale of assets in its first quarter. Revenue is expected to be about $US420 million. SGI is now putting in place a "new company-wide operating model" and expects to sell further assets worth up to $US450 million during the rest of the year.

Compuware warned that second quarter revenue will be in the range of $US474 million to $US487 million, but earnings per share are likely to fall between four and six cents. As a spokeswoman noted bluntly "quarterly revenues were lower than expected due to a shortfall in software licence sales".

No such problems for PC manufacturer Gateway, which lifted third quarter net profit by 35 per cent to $US152.6 million on revenue that climbed 16 per cent to $US2.53 billion. The positive performance was attributed to strong growth at the consumer and small business end of the market, and continued growth in Europe.

Unisys was another to struggle when its third quarter net profit slipped 69 per cent to $US42.9 million and revenue dipped nine per cent from $US1.9 billion to $US1.7 billion. Services revenue remained weak and hardware sales declined. The company is now implementing a cost-cutting plan that will kick off with the offer of early retirement to about 1500 US employees.

In the quarter to September 30 Motorola lifted revenue from $US8.06 billion to $US9.49 billion, and boosted net profit from $US361 million to $US598 million. During the quarter the company accounted for a charge of $US95 million due to the discontinuation of older wireless telephone products.

Chip manufacturer Advanced Micro Devices lifted sales from $US662.2 million to $US$US1.2 billion and turned a loss of $US98.99 million a year ago into a net profit of $US408.6 million in its third quarter to October 1. The results included a gain of $US336.9 million from the sale of the Legerity voice communications business.

Seagate Technology lifted first quarter revenue from $US1.68 billion to $US1.75 billion and boosted net profit from $US2 million a year ago to $US75 million.

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