Adobe stretches government arm with Accelio buy

Adobe Systems Inc. is acquiring e-form solution provider Accelio Corp. in a $72 million deal that Adobe officials hope will expand its government reach.

According to Shantanu Narayen, executive vice president of worldwide products for Adobe, the purchase will allow Adobe San Jose, Calif., to offer broader electronic document solutions as well as leverage Accelio's government customer base.

"One of the things Accelio already has is a significant installed government base and partnerships with integrators, including Accenture in an e-government accelerator program. That's something we'll be leveraging," Narayen said.

Under the terms of the agreement, announced Feb. 1, the Adobe stock, worth $72 million when trading ended Jan. 31, will be exchanged for all Accelio securities. The transaction is expected to close in late March 2002.

The sales follow a failed, unsolicited takeover bid last December of Accelio, formerly called JetForm Corp., by document management provider Open Text Corp., Waterloo, Ontario.

While Adobe makes the Acrobat document reader and holds rights to the widely used portable document format, Ontario-based Accelio has software suites that can design electronic forms, integrate form information into back-end systems and serve up the data in presentations, Narayen said. Adobe will pair the offers to offer more enterprisewide solutions.

According to Steve Weissman, president of analyst firm Kinetic Information LLC., Waltham, Mass., the purchase is the "biggest reshaping of the electronic forms market since 1996," when Accelio purchased its largest competitor, Delrina FormFlow.

"Accelio and Adobe both are very strong players in e-forms. ... Combining them would significantly change the rules [of the electronic form market]," Weissman said.

Weissman predicted the combined work-flow and electronic forms market will reach $7.3 billion by 2004, up from an estimated $2.8 billion in 2001.