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Why does a combination of Sterling Software and Synon Corporation make sense?

Sterling Software is the leading provider of enterprise application development solutions, while Synon Corporation is known for their leadership in model-based application development for the AS/400 and NT platforms. Synon’s technology combines model-based application development with pattern libraries of reusable objects, allowing software developers to efficiently implement business changes into their applications. Together, the companies will be able to offer the industry’s most advanced and comprehensive environment for enterprise-scale, business-driven, component-based application development.

By joining Sterling Software, Synon will be better able to achieve its growth objectives, improve customer satisfaction and increase the opportunities for its employees. Joining a larger company should allow Synon to do a better job in areas such as marketing, development, customer support and employee development. At the same time, it gives Synon the ability to take its leading technology into new market opportunities.

The addition of Synon/2E and Obsydian to Sterling Software's product portfolio will expand Sterling Software’s leadership position in the enterprise application development market to also include the AS/400 development market, while delivering additional capabilities in the rapidly emerging development market for NT applications. At the same time, Sterling Software offers the strength of Sterling Software’s COOL product portfolio to Synon’s customer base. Beyond the technology fit is the combination of Synon’s most valuable resource, its employees, with Sterling Software’s outstanding employee base.

How will the acquisition affect customers?

We believe customers will benefit from the acquisition. Both Sterling Software and Synon pride themselves on their history of protecting customers’ investments in their product portfolios. Sterling Software recognizes the investment that Synon customers have made in Synon Corporation and its products and is dedicated to ensuring their ongoing success. Sterling Software plans to continue supporting and enhancing both Synon/2E and Obsydian. By joining Sterling Software, Synon customers will be partnering with a financially strong, stable company that is as deeply committed to the enterprise application development market as Synon has been.

What are the industry implications of this acquisition?

Sterling Software is the recognized leader in the enterprise application development market. Synon is the recognized leader in the AS/400 tools market. The addition of Synon expands Sterling Software’s reach into the AS/400 development market, while delivering additional capabilities in the rapidly emerging development market for NT applications. No other vendor comes close to offering the breadth or depth of the combined companies.

What will happen to Synon stock as a result of the merger?

Upon closing, each then-outstanding share of Synon stock will be converted into Sterling Software’s common stock, par value $0.10 per share ("Sterling Software Common Stock"), subject to the following conversion ratios:

  • each Synon Common Share, each Synon Series A Preferred Share and each Synon Series E Preferred Share will be converted into 0.14357 shares of Sterling Software Common Stock
  • each Synon Series D Preferred Share will be converted into 0.27149 shares of Sterling Software Common Stock