Acquisition of webMethods Pushes Up Software AG Stock
The acquisition of webMethods by Software AG, which attests to the Company’s growth, has positively impacted the price of Software AG shares on the TecDax. The stock began the second quarter of 2007 at €64.59 in Xetra trading and closed the quarter at €72.35. This represented a 12 percent rise in value; our shares thus outperformed benchmark indices such as the TecDax (10 percent), the Goldman Sachs Technology Index (10 percent) and the Nasdaq Composite (8 percent).
Announcement of the planned takeover of webMethods in early April had already caused a sharp increase in the price of Software AG stock. Share prices then declined along with the market during the acquisition process to reach a quarterly low of €62.10 on May 11. The acquisition of webMethods, Inc. was concluded on June 1 in a surprisingly quick process. Software AG shares responded to management's revenue and earnings guidance with a steep rise, surpassing the €70 mark. This upward trend was briefly interrupted by a slight correction in the markets in early June. However, European markets were once again on a clear upswing at the end of the quarter. As a result of our positive outlook for the Group, which we have actively and repeatedly communicated since the takeover, Software AG shares significantly exceeded the previous 5-year high with an all-time quarterly high of €73.40 on June 19.
Software AG's acquisition of webMethods was very well received by the capital markets. A total of 24 analysts companies in Germany, the United Kingdom and France currently cover Software AG stock. The majority of analysts have raised their target price once again and continue to issue “buy” or “hold” recommendations.
We approached additional potential and current investors in the second quarter, and were extremely well received at seven investment conferences in London, New York, Frankfurt and Zurich as well as at a total of seven road shows in the United Kingdom, Germany, Switzerland, the Benelux countries and Ireland. Investors consider the acquisition of webMethods, Inc. as a milestone in the development of Software AG and rate us as a rapidly growing company with a clearly improved market position. This leads them to see further price potential for our shares.
Software AG was given high marks for its comprehensive and transparent IR work: We received first place among TecDAX companies at the Capital Investor Relations Awards 2007 as well as the Thomson Extel Survey “Best IR Germany 2007”.
Our annual shareholders meeting took place in Frankfurt on May 11, 2007. A total of 67.47 percent of the share capital was represented – an above-average participation level for Germany. The annual shareholders meeting agreed to another proposed 10-cent increase in the dividend to €0.90 for fiscal 2006. Dipl. Ing. (TU) Alf Henryk Wulf was newly elected to the Supervisory Board. All other agenda items were approved by a majority of well over 90 percent.