City up in arms over software merger

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The Independent Online
The City is up in arms about the pounds 71m takeover bid for Rolfe & Nolan, the derivatives software specialist, by its US rival SunGard. Some of the biggest banks in the Square Mile are worried the deal will give the combined group a monopoly over computer systems for futures and options trading.

Leading City banks are lining up to lobby the Government about SunGard's acquisition of Rolfe & Nolan. They are likely to take up their fears with the Office of Fair Trading, which is investigating into the deal.

Rolfe & Nolan specialises in providing computer software to City institutions which is used primarily to process futures and options transactions. With SunGard, it dominates the market for such software.

When the acquisition of Rolfe & Nolan was announced last Thursday few people outside the City raised an eyebrow. Shareholders welcomed the 525p a share offer, which represented a 46 per cent premium to Rolfe & Nolan's closing share price. The deal also had the backing of the group's directors, who together gross more than pounds 5m from their shares and options if the deal goes ahead.

However, Rolfe & Nolan are still confident that the deal will be sanctioned. Peter Day said yesterday: "Rolfe & Nolan and SunGard will be major suppliers. But it is a very large market and there are many small software companies that could introduce these systems."

- Andrew Yates

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