Logic Works sold to Platinum

New in Town

Down-Sizing

Leaving Town

Management Moves

Deaths

Corrections or additions?

These stories by Peter J. Mladineo and Barbara Fox were published in

U.S. 1 Newspaper on March 18, 1998. All rights reserved.

Life in the Fast Lane

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Logic Works sold to Platinum

Logic Works, the University Square-based software developer

that was a darling of Wall Street when it made its IPO, has been acquired

by Platinum Technology, the $600 million computer giant based in Oakbrook

Terrace, Illinois. The Princeton company, which has 190 employees

at 111 Campus Drive and had revenues of $50 million in 1997, makes

several database development and data warehousing tools, including

ERwin and BPwin. The price: approximately $174.8 million in stock.

Logic Works will become a wholly-owned subsidiary of Platinum, which

will exchange .5769 of a share of Platinum common stock (traded on

Nasdaq as PLAT) for each share of Logic Works common stock (on Nasdaq

as LGWX).

The two companies are boasting numerous "synergies," though

it will also certainly bring change and a certain amount of downsizing.

Logic Works’ management team, headed by Gregory A. Peters, the president

and CEO who succeeded Ben Cohen, Logic Works’ founder and current

chairman, is not expected to stay on after the merger is completed.

Cohen already has embarked on a new venture, involving "a next-generation

E-mail product." Although Logic Works officials say that Platinum

will not relocate its facility at 111 Campus Drive, there will be

some reduction of staff. "It would be in the areas of accounting

and human resources that we would expect the reductions to occur,"

says Logic Works spokesperson Lina Page.

"Platinum, like Computer Associates, are consolidators who buy

anything, usually at a fire sale price," counters Dan Spinner,

an analyst and managing director of Progressive Strategies in New

York. "A good price is five-times-sales, and in this case the

price of between two-to-three-times-sales — in exchange for, not

even cash but stock — puts it in the fire sale category,"

says Spinner.

"This essentially is the board having no desire to deal with the

hassles, saying `I don’t want to deal with this any more.’ Ever since

Ben Cohen was ousted, there was no more leader."

Some Logic Works employees may feel their days are limited.

In the past week, says Bradley Schragin, a Logic Works alumnus who

is now vice president of sales and marketing for TV Objects, a software

development firm at 600 Alexander Road, "my phone’s been ringing

off the hook" with calls from employees at Logic Works inquiring

about jobs.

"Based on past performance, Platinum will save the development

staff and let go of everyone else," says Schragin. He estimates

that a company like Platinum will only keep Logic Works’ 40 or 50

software developers. "They don’t need marketing, management or

sales," he says. "Logic Works will be a little development

shop for a big company."

But Logic Works disputes this. Logic Works’ sales and marketing unit,

consisting of roughly 100 employees, "is very much going to remain

intact," says Page. Platinum is involved in several arenas, including

database and systems management, data warehousing and decision support,

application infrastructure management, and Year 2000 engineering.

Logic Works provides modeling and design tools for client/server databases,

data warehousing, and business process reengineering.

Logic Works currently has 42 percent of the data warehousing design

market; Platinum offers a solution for building and managing data

warehouses, says a press release. Also, claims Logic Works, the product

lines of the two companies have only a minimal overlap and Logic Works

will now provide Platinum with better "cross-selling opportunities."

Platinum’s goal is to get the lion’s share of the enterprise modeling

market. The combination of the Logic Works technology with Platinum’s

resources will create an entity that has "the leading technology

for entity relational, business process, and object-oriented modeling,"

says Page.

This move ends a relatively dramatic chapter in the history of this

information age company. Started in 1988 by Ben Cohen, Logic Works

took off like a revenue rocket, doing an impressive $28 million initial

public offering in October, 1995. Cohen appeared on the cover of Business

Week in early 1996 as CEO of the third fastest-growing company on

the magazine’s hot growth list. But sagging profits and stock prices

forced Cohen to relinquish the president and CEO titles by early 1997.

Recently, however, the stock has been recovering. From a low in April,

1997, of under $5 per share, it’s now up to $13. It’s gone up three

points just in the past month.

Cohen, meanwhile, is elated over this sale. "To me it’s like victory

to get the stock up and sell to a larger company," he says. "It’s

a very successful endgame for Logic Works. In the industry consolidation

is a fact of life. With our industry going through changes, consolidation

was a question of when, not whether. We didn’t want to be the last

company to consolidate."

Cohen has started a new software enterprise, Tacit Communications,

developing an E-mail product that utilizes what he calls "knowledge

management" technologies. Currently operating in Forrestal Village,

he expects to move the operation to the Route 128 corridor in Boston.

Frank Cicio, the former vice president of sales and marketing of Logic

Works who is now senior vice president of Icon Systems, a Internet

firm based in Weehawken that recently went public, thinks that the

Logic Works acquisition will help Platinum focus on end users. Logic

Works has "clearly been the leader in providing productivity tools

to the programmer, to the database administrator," he says. Software

such as ERwin, Cicio says, "will be a great add-on to their product

line."

But he reserves more moderation in describing the acquisition. "Financially

it sounds like a good deal for Logic Works considering where it’s

been in the last year," he says. "I’m not too sure if I would

call it a victory, I would say it’s appropriate."

— Peter J. Mladineo

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New in Town

Labor Ready, 1470 Prospect, Trenton 08638. John

Costa, branch manager. 609-538-9330; fax, 609-538-9335.

Anything from maid service to digging to convention setup is provided

by a new branch of a national firm with 350 offices nationwide. It

trades on Nasdaq as LBOR. Mike Rizzo opened this office last month

but soon he will be turning the three person office over to John Costa,

the new branch manager.

The firm offers to supply temporary workers "a day or an hour

before you need help," and offers a no-hassle refund if the employer

calls within two hours of the starting time.

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Down-Sizing

Wang Global, 1095 Cranbury South River Road, Suite

1, Jamesburg 08831. Paul Murray, vice president. 609-409-2500; fax,

609-409-2502. Home page: http://www.wang.com.

Wang Laboratories has consolidated its service centers in Bordentown,

Edison, at 600 Alexander Road in Princeton to 1095 Cranbury South

River Road, says Eileen Palumbo, formerly in charge of Princeton’s

office. The firm has its headquarters in Massachusetts.

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Leaving Town

Arpin Van & Storage Inc., 5 Marlen Drive, Robbinsville

08691-1604. M. Robert Arpin, president.

This moving and storage firm has closed and its operations merged

with the Atlas-connected firm, Ace Worldwide Moving, at 45 Executive

Drive, Edison 08817. Phone is 732-248-5755, fax 732-248-5778.

Grubb & Ellis, 101 Fieldcrest Avenue, Raritan Plaza

3, Edison 08837. Doug Petrozzini, senior vice president. 732-225-0433;

fax, 732-225-6167.

Grubb & Ellis moved from 2 Research Way to Edison’s Raritan Plaza

3. Phone and fax are new.

National Council on Compensation Insurance Inc.,

812 Route 206, Princeton 08540. Douglas M. McEwen, regional sales

manager.

Douglas McEwen has moved his information technology sales office of

the National Council on Compensation Insurance from 812 Route 206

to a 25-person office at 5 Marine View Plaza, Fourth Floor, Hoboken

07030, 201-222-0500; fax, 201-222-8880. Headquartered in Boca Raton,

the firm collects data in 32 states for various insurance companies

and specializes in workers’ compensation.

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Management Moves

Capital Health System at Mercer, 446 Bellevue Avenue,

Box 1658, Trenton 08607-1658; 609-394-4000; fax, 609-394-4032.

Charles E. Baer has resigned as president and CEO of the system formed

by the merger of Mercer and Helene Fuld medical centers. Baer had

been CEO at Mercer Medical, and Al Maghazehe (who had been Helene

Fuld’s CEO, following the resignation of Ira Shimp) has been named

interim president and CEO.

The Chauncey Group International, 506 Carnegie

Center, Princeton 08540. Alice Irby, president. 609-720-6500; fax,

609-720-6550. Home page: http://www.chauncey.com.

Upon Alice Irby’s imminent retirement, Judith D. Moore will be president

and CEO of ETS’ for-profit subsidiary. Moore is now president of the

National Industries for the Blind, which provides jobs for 5,500 in

115 facilities. She had also been director of state and local government

relations at Eastman Kodak in Rochester, New York. The subsidiary

does testing, certification and other human resource development services

for corporations, the professions, and government.

New Jersey Restaurant Association, 1 Executive

Drive, Somerset 08873. Deborah Dowdell, executive vice president.

732-302-1800; fax, 732-302-1804.

Frank Panico, owner of the New Brunswick restaurant with the eponoymous

name, is the new president of the association.

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Deaths

Sieglinde Heinzerling, 56, on March 5. She supervised

equity research analysts at Bloomberg Financial Markets.

Marion Dorland Stark, 84, on March 9. She worked at Princeton

University and was the first woman to earn a pilot’s license at Mercer

County Airport.

Elizabeth A. David, 55, on March 14. She was a licensed

practical nurse at the Medical Center at Princeton.

Frank S. Perna, 64, on March 14. He owned South’s Garage

on Moore Street from 1972 to 1997.

Corrections or additions?


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