Lexmark sells enterprise software business, once key to its strategy

Lexmark is selling its enterprise software business, once the centerpiece of its business strategy, to private equity firm Thoma Bravo.

The acquisition, announced Wednesday, effectively puts a stake in the aggressive diversification strategy that former CEO Paul Rooke thought would cushion the company in an uncertain printer market. After the company’s sale and Rooke’s departure, the company had said in 2016 that it was looking to shed the enterprise software business.

Lexmark is now owned by a group of investors headed by China-based Apex Technology, PAG Asian Capital, and Legend Capital. The all-cash transaction was $3.6 billion and took the company off the New York Stock Exchange.

Thoma Bravo has offices in Chicago and San Francisco. No sale price was given in a news release Tuesday about the sale, and messages seeking clarification were not immediately returned.

The sale is expected by the close of the third quarter of 2017. Lexmark had said last year that the enterprise software business would be rebranded as Kofax and sold, and the remainder of Lexmark and the consortium that now owns it would focus “on growing the imaging business, particularly in China and the Asia-Pacific region,” according to a 2016 Lexmark news release.

The Perceptive Software business will be sold to Hyland Software, an existing Thoma Bravo company. Lexmark and Hyland Software engaged in a 2014 battle to acquire Sweden’s ReadSoft. Lexmark emerged the victor.

The Perceptive Software business includes Perceptive Intelligent Capture, Acuo VNA, PACSGEAR and Enterprise Medical Image Viewing. The Kofax and Readsoft businesses will create a single, newly independent Thoma Bravo portfolio company under the Kofax brand, which will be led by Reynolds Bish, current president of Lexmark Enterprise Software.

As of last year, Lexmark had 2,300 employees in Lexington and is one of the city’s largest private employers. Lexmark said Wednesday it would have no comment on the sale. It is uncertain how many employees will leave Lexington as a result of the sale.

This story was originally published May 3, 2017 at 12:09 PM with the headline "Lexmark sells enterprise software business, once key to its strategy."