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Baan rushes to seal Invensys deal

The cash-strapped business software maker isn't wasting any time finalizing the $708 million bid from the U.K. automation equipment maker.

Cash-strapped business software maker Baan isn't wasting any time finalizing the $708 million bid from Invensys, a U.K. automation equipment maker.

Baan, which announced its intentions to sell its business to Invensys last month, said it will hold a shareholders meeting on June 29 to discuss the cash offer.

Invensys, which is known for its manufacturing automation systems and other products aimed at the manufacturing industry, has agreed to buy the struggling software maker for 2.85 euros ($2.65) a share.

The company plans to form a new U.S. software unit--Invensys Software and Systems (ISS)--that will incorporate Baan's full suite of Web-based business management applications, such as its core enterprise resource planning (ERP) software. ERP software helps automate a company's back-office system, including its human resources, financials and manufacturing needs.

At one point, Baan was reaping the benefits of the fast-growing ERP software market, but it quickly faced a drastic market shift as the Internet began to play a much more important role in each companies' business needs. Companies are now turning their investments to less complicated Web-based business applications, such as those that automate a company's sales and marketing operations. But Baan was late to embrace the Internet and suffered from challenging financial quarters, a series of management changes, and a plunging stock price.

Most of Baan's rivals including SAP, PeopleSoft and J.D. Edwards have also seen sagging ERP software sales, but for the most part have been moving aggressively by switching their focus to offer more lucrative Web-based business applications.

Baan, which has long been rumored as a takeover target, has not specified when the Invensys deal is expected to close. The shareholder meeting will be held at Baan's headquarters in the Netherlands, the company said.