FYI: PowerSoft / Sybase Merger - Press Release

For Immediate Release

SYBASE AND POWERSOFT SIGN DEFINITIVE MERGER AGREEMENT Merger of Fastest Growing Database and Tools Companies Creates the Worldwide Leader in Client/Server Software

BOSTON, MA, November 14, 1994 -- Sybase, Inc. (NASDAQ: SYBS) and Powersoft Corporation (NASDAQ: PWRS) today jointly announced that the companies boards of directors have unanimously approved a definitive agreement to merge and create the worldwide leader in client/server software.

        Under terms of the merger agreement, Powersoft shareholders will receive 1.6 Sybase shares for each Powersoft share. The transaction is expected to be tax-free to both companies shareholders and to be accounted for on a pooling-of-interests basis. The merger is subject to a number of standard conditions including regulatory approvals and approval by the stockholders of each company.

        Mark Hoffman, Sybase chairman, CEO and president, commented, This merger will create the worldwide leader in client/server software. Separately, Sybase and Powersoft now have the number one positions in client/server tools, database connectivity, and based on our third quarter numbers, the highest growth rate for database servers. The combination of the two companies strengthens our expertise, distribution, and product solutions to scale from the desktop to the enterprise.

        The combined company will have trailing twelve months revenues (third quarter, 1994) of $730 million, making it the seventh largest software company in the world. Its combined year-over-year growth rate of 75 percent makes it the fastest growing company of the top ten software companies worldwide. Based on balance sheets as of September 30, the combined company will have over $236 million in cash and equity of approximately $365 million.
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Company Operations

        Under terms of the agreement, Powersoft will operate as an independent subsidiary of Sybase, Inc. David Litwack, Powersoft president, will report to Dave Peterschmidt, Sybase chief operating officer. Mitchell Kertzman, Powersoft CEO, will report to Mark Hoffman.  Kertzman and one other Powersoft director, to be named, will hold new seats on the Sybase board.

        The merged company will continue its commitment to open systems.  Powersoft will remain an open database tools provider. Sybase will continue its strategy of working with multiple tools -- those of other independent client/server tools companies as well as its own. Sybases Windows application development tool, Build Momentum, will be held in controlled release, pending exploration of product synergies.

        Kertzman commented, Powersoft and Sybase have had a long-standing partnership which underscores the strength of this merger. The biggest winners are customers who will have the best of both worlds. They can do business with a single source for the broadest range of the best client/server products. Alternatively, customers requiring open solutions can be secure in the knowledge that the products they choose from Powersoft and Sybase are the best in their class and will interoperate with all other RDBMS, tools, and connectivity products.

Leaders in Client/Server

        Sybase, Inc. is one of the fastest growing suppliers of client/server-based software products and services worldwide. The company is the second largest RDBMS vendor worldwide, and the leading provider of database connectivity/interoperability software. Sybase develops and markets the System 10 family of database servers, connectivity software, and database administration products; the Momentum family of application development tools; and Intermedia interactive multimedia products.

        Powersoft develops and markets the Powersoft Enterprise Series, the first family of scalable tools that encompasses the application development and data access needs of professional developers and end users across the enterprise. According to The META Group, an independent market research/consulting firm, Powersoft is the leading client/server tools company, with approximately 40 percent market share worldwide.

Complementary Strengths

        Sybase and Powersoft share a commitment to open architecture and have complementary strengths and focuses in the client/server industry. In terms of product, Sybase has concentrated on servers, while Powersofts emphasis is on the client. From a platform perspective, Sybases focus has historically been UNIX, with a growing installed base of Novell NetWare, Microsoft Windows NT, and OS/2. Powersofts strength has been products for PCs running MS Windows, with recently announced support for UNIX and Macintosh platforms. Sybases distribution is primarily through its direct sales organization, complemented by VARs, system integrators, and international distributors. Powersofts focus has been on resellers complemented by a direct sales force. Both companies share a common vision of open architecture, with Sybases focus on providing database connectivity products and ensuring support for multiple tools, and Powersoft committed to supporting the leading RDBMSs and other client/server development technologies.

        Both companies develop and market key products in addition to those listed above. Sybase provides a full line of client/server tools, connectivity, database administration and interactive multimedia products. Watcom, a division of Powersoft, develops and markets high performance application development tools and databases, including language products and Watcoms PC-based client/server SQL database servers.

Leveraging Customer and Distribution Synergies

        Sybase and Powersoft have worked cooperatively for the past four years to provide solutions to customers. Powersoft estimates that 50 percent of its customer base uses Powersoft tools with SYBASE® SQL Server databases. Sybase estimates that 30 percent of its SQL Server customers develop applications with Powersoft tools.

        Sybase and Powersoft will leverage their respective distribution and partner strengths. The combined company will have more than 2,000 independent software vendor and application partners. Sybase markets its products worldwide through its direct sales force, telesales, distributors, OEMs, VARs, and systems integrators. The company currently has more than 35 North American sales offices and 15 subsidiaries and 27 distributors worldwide. Powersoft markets its products worldwide through resellers, international distributors, and a direct sales force. Specifically, Powersoft has approximately 450 value added resellers in North America, 600 resellers worldwide, and a direct sales organization of approximately 150 in North America. Internationally, Powersoft has eight subsidiaries and 17 distributors.

Financial Strength

        Sybase, headquartered in Emeryville, CA, reported 1993 sales of
$427 million, an increase of 61 percent over 1992. Its revenues for the
last twelve months through the third quarter of 1994 were $617 million, representing a year-over-growth rate of 67 percent.

        Powersoft, headquartered in Concord, MA, reported 1993 sales of
$57 million, an increase of 118 percent over 1992. Its revenues of the
last twelve months through the third quarter of 1994 were $113M, representing a year-over-year growth rate of 146 percent.

        Sybase, Inc. is being advised in this transaction by Bear, Stearns & Co. Inc., and Unterberg Harris. Powersoft is being advised by Goldman, Sachs and Co.

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SYBASE, SQL Server, Build Momentum, Momentum, Intermedia and System 10 are trademarks of Sybase, Inc. Powersoft and PowerBuilder Enterprise are trademarks of Powersoft Corporation. Watcom is a registered trademark of Watcom International. All other company and product names may be trademarks of the respective companies with which they are associated Received on Tue Nov 15 1994 - 17:05:51 CET