HONG KONG, ATLANTA, 17 July, 2008—CDC Corporation, Praxa's parent company & a leading global enterprise software and new media company, today announced that, given the current market environment, CDC Software has filed to formally withdraw its registration statement on Form F-1 previously submitted to the United States Securities and Exchange Commission with respect to the planned initial public offering of CDC Software common shares.
"In consultation with our underwriters and members of the CDC Corporation Board of Directors, we have decided to withdraw the IPO of CDC Software at this time," said Peter Yip, CEO of CDC Corporation. "The capital markets are clearly strained and we have to focus exclusively on improving core operating metrics, generating cash from operations, and preserving cash. We cannot be distracted from these important goals by the effort and expense required for an initial public offering."
As a result of this decision, as well as other planned management changes, Eric Musser, formerly the president and CEO of CDC Software, is leaving the company to pursue other business interests. In addition, Michael Latimore, formerly the chief financial officer of CDC Corporation, has also left the company to pursue other opportunities. He will continue to work at CDC until the end of July and has agreed to provide consulting services to the company on a part-time, as-needed basis. The company has also commenced a search for a CFO for CDC Corporation.
"Our exclusive focus today is to improve our operations and business fundamentals, primarily in the areas of cash generation and profit margins," added Yip. "As a result of our decision to withdraw the planned IPO, as well as the execution of a new business model, we have realigned our executive management. This realignment made good business sense since it will enable us to promote further efficiencies within all of the CDC divisions, and ultimately, help us maximize shareholder value. At this time, it simply does not make sense to have a CEO at our CDC Software division. That is why I am very pleased with the current, revised organizational structure.
"The team we now have in place has been responsible for shortening quarterly reporting schedules, accelerating the integration of past acquisitions, including standardizing the entities on a common IT system, reorganizing our Global Business Services Group and identifying and implementing the recent cost-cutting moves," said Yip.
"We believe that a key part of our future success will be to continue to align ourselves as a strategic technology partner for our clients by protecting their IT investments now and into the future," Yip added. "We are committed to delivering best-of-breed technology and functionality. I have been personally meeting with several of our existing customers and prospects as well as major partners in key markets around the world over the past year. I plan to continue this effort since I have received very positive feedback from them on our strategy. We plan to enhance our role as a vital partner to customers by helping them better manage their operations at optimal efficiency in this challenging environment brought about by a difficult credit market, and rising fuel, transportation and commodity costs. We plan to accomplish this by using a three-pronged approach. First, we expect to continue to enhance our customers' existing strategic applications in Customer Relationship Management (CRM), Global Manufacturing Operations Management (GMOM), Enterprise Resource Planning (ERP), and Supply Chain Management (SCM). Secondly, we intend to leverage our assets to bring new products to market quickly. Finally, we plan to capitalize on leading partnerships to increase our customers' return on IT assets."