Adding roughly 200 customers to its legacy modernization customer base, Software AG is buying the legacy renewal product lines of software provider Jacada for $26 million. In return Jacada will get the rights to use most of the products being sold as part of its call center products, which are the core if its business. 

Specifically, Software AG is assuming the intellectual property and existing customer contracts associated with three Jacada lines: the Terminal Emulator, which provides the core screen scraping capability for the front end; HostFuse and WinFuse, which wraps legacy and Windows client/server session interactions, respectively, as web services; Innovator, which converts COBOL or RPG to browser-based web applications; and Studio, which lets you build GUI-based apps for the iSeries.

For its part, Software AG already has Eclipse-based offerings that let you wrap legacy applications as web services. Additionally, Software AG’s host modernization offerings allow legacy programs, not only to expose services, but consume than as well. And because Software AG has a broader SOA platform (most of which are under the webMethods umbrella), web services that are exposed through the Jacada tools can integrate into the rest of the line, including registry and repository, ESB, and the Web 2.0 rich Internet application composition tools.

The deal does bring some inevitable product overlap, as the heart of the Jacada toolset covers the same kind of web service encapsulation of legacy transactions that Software AG’s already perform. However, Jacada also brings to the table the ability convert Windows client/server apps dating from the pre-.NET era that lack uniform APIs – and from a service enabling standpoint, are as challenging to service-enable as classical “legacy” apps.

Consequently, the net effect of this deal is that Jacada gets to concentrate its limited resource on its core call center business, while Software AG gets a chance to add a couple hundred customers to an existing business for a purchase price that is just over twice its annual run rate.

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