BASS Software Ltd., a leading global provider of software for fleet and rig management, will use the financial resources it freed up after selling itself out of Star Information Systems (SIS) to continue to invest in its own business by pursuing new markets and developing new products.
“The price we received was satisfactory, based on the limited financial information we received from the company,” said BASS Chief Executive Officer Per Steinar Upsaker.
“We lost confidence in SIS. When they asked shareholders for additional funding, we saw this as an opportunity to sell out rather than put more money into a business with highly uncertain returns and no exit strategy,” he said.
In 1999, BASS bought a 34 percent stake in SIS, a supplier of maritime software, as an opportunity to complement its product assortment and geographical reach. Since then, however, a strained liquidity situation and very low profit margins have prevented SIS from paying out dividends and investing adequately in product and technology upgrades.
Because of SIS’ poor performance and its need for major funding over a long period of time to upgrade its products and technology platform, BASS approached the other shareholders asking to discuss an exit strategy, something they were not willing to do. When SIS asked shareholders for additional funding in June, BASS saw this as a divestment opportunity and agreed with other shareholders in September to sell its stake in the company.
BASS already invests substantially in product development, with about 25 percent of revenue earmarked for this purpose, and the fresh capital will further bolster these efforts. The extra funds will also allow BASS to pursue new markets and customers, including attractive offers to upgrade to BASSnet – a more comprehensive and modern solution.
“With the launch of our latest BASSnet 2.7 software suite, we’re in a position to discuss opportunities in the market with new customers as well as with existing ones,” Upsaker said.
Unlike many of its competitors, BASS has built its software suite - BASSnet™ Fleet Management Systems - on Microsoft.NET as part of its aim to use mainstream tools and development platforms to avoid relying on technologies that become obsolete.
The decision to sell the shares had nothing to do with a dispute with SIS over the validity of a previous shareholders agreement, which was resolved in an out-of-court settlement in January 2010, according to Upsaker.