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BELLEVUE, WA - January 5, 2006 - Onyx® Software Corporation (NASDAQ: ONXS), a worldwide leader in customer process management solutions for the enterprise, announced today that a Special Committee of its Board of Directors, comprised of independent directors and formed for the purpose of evaluating the unsolicited proposal from CDC Corporation (NASDAQ: CHINA), has unanimously rejected the proposal and has communicated this decision to CDC.
Onyx first received an unsolicited proposal from CDC on December 6, 2005. In mid-December the parties agreed to meet on December 30, 2005 to discuss the CDC proposal. Based upon discussions at that meeting, and upon subsequent assessment of the proposal, Onyx's Special Committee has determined that the proposal from CDC is not in the best interests of Onyx shareholders. For the reasons listed below, among others, the proposed transaction would not produce a stronger combined entity, and would risk eroding value for Onyx shareholders:
- CDC Software division assets are performing poorly, as evidenced by lower reported 2005 license growth compared to Onyx;
- CDC is proposing that Onyx pay a significant premium for the CDC Software division assets;
- CDC lacks a sustained history of profitable operations and has a poor track record of delivering shareholder value, but would have a significant controlling interest in the combined entity;
- CDC has so far been unable to achieve synergies among the CDC Software assets it has proposed to combine with Onyx, as demonstrated by the steadily decreasing valuation of CDC since the Ross and Pivotal acquisitions;
- The expectation that there would be limited synergies between the Onyx and CDC product lines compared with significant and inevitable cash costs of combining and integrating the two entities, and the potential for customer attrition;
- The proposal will be highly dilutive to current Onyx shareholders;
- Current Onyx shareholders would receive no cash consideration and would face the prospect of limited liquidity; and
- Input from major Onyx shareholders who expressed a strong negative reaction to the proposal.
As Onyx has previously indicated, it is not seeking a sale of the company. Onyx intends to continue executing on the growth strategy that it has articulated to its customers, partners and shareholders. Onyx shall continue to build on its license revenue growth, significant improvements in operating results, the addition of many new brand name customers and the recent Buy ratings from both Zacks Investment Research and Roth Capital. The Special Committee rejects the unsolicited offer from CDC and considers this matter closed. About Onyx Software
Onyx Software Corporation (NASDAQ: ONXS) is a worldwide leader in customer management and process software for mid and large size enterprises. Onyx provides flexible solutions that enable organizations to automate, manage, and evolve their customer processes quickly and cost-effectively for strategic advantage. By providing an integrated suite of customer process automation applications encompassing customer management, process management, and analytics capabilities, Onyx enables enterprises to reduce costs, increase productivity and grow revenue. Major companies are aligning their customer-facing departments and managing their customer processes with Onyx software - companies such as Amway Corporation, Mellon Financial Corporation, The Regence Group and State Street Corporation. More information can be found at (888) ASK-ONYX or info@onyx.com Forward-Looking Statement
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