In a somewhat surprising announcement, SirsiDynix announced late last week that it had a “new investment partner,” Vista Equity. Details were scant but a formal (and only slightly more detailed) press release (pdf) was issued yesterday.
Vista is a private equity firm with over $1 billion in capital, primarily in the software and technology sectors. SirsiDynix, of course, is one of the biggest players in the market, with nearly 4,000 clients. Sirsi and Dynix merged only 18 months ago to create the largest company in the library automation sector.
“We are long-term investors in technology companies that are committed to market leadership. We are tremendously excited about working with SirsiDynix because it is clearly the market leader with a suite of mission-critical software solutions. We look forward to working with the management team to deliver to libraries the solutions they need to fully pursue the opportunities that are available to them.”
– Robert F. Smith, Vista Founder and Managing Principal
Seaport Capital (main investor of Sirsi Corporation) reportedly owned about 80% of the company; Hicks, Muse, Tate & Furst (previous owners of Dynix) another 10%; with the remaining in the hands of executives and directors. Exact terms of the agreement between the two private firms were not released.
“Vista and the management team are excited about the library industry, SirsiDynix’s position within it, and the opportunities that lie ahead for both.”
-Patrick Sommers, SirsiDynix CEO
The press release did not include any details about the future direction of the company, its management, or product release plans. Nevertheless, the news is ripe for musings.
It’s getting hard to tell these days whether the “outside world” has woken up to the library automation market or if there is some sort of fire sale going on in the industry that was born out of libraries and now belongs to a few private owners and equity firms. The news will be of no great consequence to most libraries, but will certainly pique the interest of close industry followers. It should also be of keen interest to the open source software movement, which needs press such as the recent changes in the industry to build some buzz for OSS as an alternative to the frequent shifting of ownership among the shrinking choices of library systems.
As Lorcan Dempsey has suggested recently, here and here, it’s high time we puzzled about these changes a bit more. I don’t particularly agree that these firms see libraries as cash cows just waiting to hand over more of their money. I’ve talked to these equity firms before and they are all about due diligence. There must be something else to all this. I blame my lack of poignant explanation on having an MLS instead of an MBA.
I still don’t think this is over. Stay tuned.
[This post originally appeared as part of American Libraries’ Hectic Pace Blog and is archived here.]