Dutch exchange orders ailing software firm to bolster finances; shares slide

LONDON (CNNfn) - Troubled Dutch business software company Baan was threatened Thursday with expulsion from Amsterdam's blue-chip AEX stock market index unless its finances improve.

The Amsterdam Stock Exchange waived its right to impose "special listing conditions" on Baan - tantamount to demotion from the AEX - but gave the company a month to come up with fresh funds to improve its balance sheet.

Baan shares have fallen by almost two-thirds since Jan. 4, when it unexpectedly warned of a fourth-quarter loss and said Chief Executive Mary Coleman was leaving after a spell of just six months. She was swiftly joined by Baan's finance director.

On Thursday Baan said it intended to raise extra equity, and was discussing with investors ways to enhance its financial position. The company told the Dutch exchange it had $197 million in cash and securities and shareholder equity amounting to just $9 million.

Baan has sought to strengthen its balance sheet with the sale of its computer services arm, Coda, for $50 million. The company has hired investment bank Lazard Freres in a bid to raise fresh equity.

Although the exchange gave the company some breathing space before excluding it from the index, Baan shares fell almost 16 percent by mid-afternoon, trading at a five-year low of 5.89 euros - well below the 7 euro level that analysts had said would make the company a takeover target. Baan's shares have tumbled at a time when rivals such as Germany's SAP have soared on a booming market in Net-based business-to-business services.

"The online market conditions are definitely improving but Baan is failing to benefit because of all its problems," said Ruurt van der Torre, sector analyst at ABN Amro in Amsterdam.

Baan is seeking to play catch-up in the B2B sector, and van der Torre predicts that the investment costs will lead to a $25 million operating loss in the first quarter. "The second quarter will be crucial and Baan will continue to generate losses," he added.

За дополнительной информацией обращайтесь в Interface Ltd.

Interface Ltd.