Follett Software Co., the No. 1 provider of library automation solutions to K-12 schools, has acquired leading competitor Sagebrush Corp.’s library automation business, including the Accent, InfoCentre, Athena, and Spectrum lines of software, the two companies have announced. Experts say the deal–which caps negotiations between the two largest players in the library automation systems market–could have a significant impact on schools and libraries using these and other web-based tools.
Follett’s Destiny and Circulation Plus software titles reportedly are used in as many as 38,000 K-12 school libraries; Sagebrush counts some 24,000 K-12 schools as its customers. The deal would give Follett an estimated 70-percent share of the school library automation market, according to Marshall Breeding, author of School Library Journal’s annual library automation survey.
Financial details of the transaction were not immediately available at press time, but sources close to the deal say Follett plans to continue supporting the Sagebrush brand for the immediate future.
Follett acquired the rights to the Sagebrush name as part of the deal. The remaining Sagebrush product lines, including Sagebrush Books and Sagebrush Library Services, will be spun off as a new, separate company, called Savia LLC, company executives told eSchool News. Rather than focus on library automation, the new company will work to build out Sagebrush’s remaining products, including its suite of school-based data management solutions and educational book services.
Savia will be led by Bob Hebrink as chief executive officer and Margo Osadchuk as senior vice president. Jim Zicarelli, former CEO of Sagebrush Corp., will continue with the new company as a member of its board of directors.
Follett says it plans to continue supporting Sagebrush’s library products and will make no immediate changes to the day-to-day operations at Sagebrush. Officials will take the next 30 to 45 days to analyze their holdings, dig deeper into the products, and then produce a full integration plan for bringing the two companies together, said Tom Schenck, Follett’s president.
“Sagebrush has been a highly respected name in library automation for more than two decades, and we are committed to continuing to provide Sagebrush customers with outstanding service and innovative software solutions,” Schenck said of the deal. “Delivering outstanding support to our new customers is of utmost importance to us, and we plan to continue supporting Sagebrush products for the foreseeable future.” Schenck added: “Our highest priorities are to ensure that the transition from Sagebrush to Follett is seamless and simple and to keep our new customers involved and informed throughout the integration process. Consequently, as we make any future changes to the Sagebrush product line, we will work closely with our new Sagebrush customers to make the timing of upgrades to new technology as easy and seamless as possible.”
Analysts familiar with the acquisition said that, though not surprising from a business standpoint, the deal eventually could lead to changes for school customers.
“The library automation market is not a rapidly growing market, and so in a mature market like that one, you’re bound to see consolidation over time, where competitors will purchase one another as a way to strengthen their position,” said Adam Newman, managing vice president of industry solutions for Eduventures Inc., a Boston-based ed-tech research firm. “In the case of Sagebrush, I think what they’re doing is placing a bet on other parts of their business–for them, it’s about growth.”
Newman said Follett’s purchase could reduce the number of options available for school customers, adding that Follett likely will take the best elements of its recently acquired purchase and integrate those with its existing product line, creating a standard platform.
“I think successful companies use this as an opportunity to listen to a broader set of customers, find out what their needs are, and create something even more valuable out of two companies,” Newman said. “Some companies simply buy customers and move those folks over to their solutions. Follett is extremely established and a well-regarded player, and I assume they’ll do everything possible to continue to support their clients. You can’t be No. 1 in the market and not be listening to customers.”
As for Savia, under Hebrink’s leadership, the company plans to focus on its core competencies of book services and library services for business partners. Executives say they also plan to grow the company by expanding its presence in the information management business, particularly with its Viewpoint product, a web-based tool designed to help educators manage and interpret student achievement data. For Sagebrush, the move represents a shift away from library automation and into the rapidly growing field of school data management.
“Sagebrush Books and Sagebrush Library Services will continue their 50-plus years of servicing customers with the value, quality, and service they have come to expect,” said Hebrink. “With this new opportunity to focus on these areas, we expect to see continued growth in our core book business, with broader product offerings and additional services to meet the evolving needs of today’s library. We also expect to expand our industry-leading position in library services and grow our market share in helping districts manage information.”
Hebrink said the company will be discussing technology advancements in the coming months, but for now it will focus on helping customers take advantage of the core assets it has retained. All of Sagebrush’s remaining product lines will keep their current names in the near term, because it is convenient for the company and easier for customers, he added.
Follett Software Co.