Software firm Datalex, based in Howth, Co Dublin, has been approached by several firms interested in acquiring it. The company's management has also considered taking it private, its chief executive said yesterday.Speaking to The Irish Times, Mr Neil Beck said the software firm had rejected the overtures of the third parties out of hand because the valuations were far too low.
He also said the firm had taken a "cursory glance" at the benefits of taking the company private. Although not rejecting this option, Mr Beck said Datalex would now focus on business fundamentals and making the firm profitable.
The company, which recently completed a restructuring that reduced staff numbers to about 300 people from a high of almost 500 in 2001, has seen its share price collapse since last year.
The firm's shares are now worth just 28 cents compared to €1.15 a few days before the September 11th attacks, which caused revenues at the firm to slump as travel firms cut costs to ensure survival.
The impact on Datalex was significant. It reported $5.6 million (€5.7 million) revenues in the first quarter of 2002, less than half the figure recorded in the same period last year.
The firm lost $4.2 million during the first quarter, down from $13.2 million in the corresponding quarter last year. Mr Beck said the the current Datalex share price hovering between 28-30 cents was "absurd" as the cash reserves at Datalex were double the firm's market capitalisation of €20 million.
"There aren't really too many benefits to being quoted at the moment. There is great reluctance worldwide to invest in technology firms and there is great distrust from the investment community," he said.
"Whenever the share price is where it is there are always people who come to talk to you about buying the company," he said. But none of the offers from third parties attracted serious consideration from management, said Mr Beck, who did not reveal the names of the firms.
"Unless the fundamentals of the business are sound then no options are of great value to anyone," he said.
"My main job is to bring value to shareholders and I've got to think almost on a daily basis about what to do."
Mr Beck said the business was currently doing well and the order book was beginning to fill up following the formation of a sales task force headed by the Datalex's major shareholder and former chairman, Mr Neil Wilson.
The firm yesterday announced it had signed a deal with the UK travel firm Page & Moy.
Datalex would meet expectations when it reported second-quarter results in early September, said Mr Beck.
Despite the bankruptcy of US Airlines this week the worst could now be over for the travel business, he added.
"People are now thinking of going back to the business plans they had prior to September 11th. Companies are re-starting their plans to become e-businesses.
"The last three months have seen the highest activity there has ever been in the company. I'm now starting to think about growing the firm again although we will continue to be prudent."
