Unify buys a new identity

Contact: Brenon Daly

It’s fairly rare for an acquiring company to take on the name of the target it has purchased, and it’s even more uncommon for the buyer to then dive headlong into the business it just picked up. And yet, that’s exactly what’s happening at Unify Corp, an old-line vendor now known as Daegis. (See our full report on the transition.) The name trade comes almost exactly a year after Unify spent some $38m in cash and stock to acquire its new namesake, Daegis. That was more, collectively, than Unify had spent on all of its other deals.

Before it added Daegis, Unify had been known for its software application development and migration tools. The 30-year-old company realized that there probably wasn’t much value to be created by being a fairly staid performer in a fairly staid market, so it went shopping. In 2009, Unify bought a small archiving and records compliance provider, AXS-One. It followed that up a year later with the much more significant purchase of Daegis, which got the company squarely in the e-discovery market. That business is now providing virtually all of the growth for Unify/Daegis.

While the new focus on the e-discovery space is a reasonable – and potentially profitable – move for Unify/Daegis, the transition does bring a fair amount of risk. The vendor already had to bump back the release of the product that was supposed to combine Unify’s archiving technology with Daegis’ e-discovery capabilities. Further, it recently scrapped any financial guidance as it sorts through its changes in business model. So far, Wall Street hasn’t really voted on the renamed and refocused company. Shares in Daegis, which also have the new symbol DAEG, are largely unchanged over the past month.