Can Workstream Survive?
Late today, Workstream announced the termination of its proposed merger agreement with Empagio. Presumably, the faltering stock price, now hovering around $0.30, is likely one of the reasons for the separation.
Immediately after the merger agreement was signed, Workstream quickly replaced a majority of the management team. Last quarter, losses increased significantly due to interest expenses. Even if they are successful recovering the $5 million termination fee, the odds of Workstream’s survival seem like a long shot at this point.
Discuss.
Technorati Tags: Workstream, talent management, merger, termination
10 Comments Add your own
1. RSM Alumni | June 14th, 2008 at 11:57 am
Having sold products and services from WSTM, I’m saddend to see such a significant volume of work done on the latest release be so mis-managed in the marketplace.
The Kadiri solution remains one of the best in it’s class. Given compenastion was the only real product pick-up from Vurv, perhaps an ERP will counter the Taleo deal with a pick-up here.
Best of luck to all the talented people left in the WSTM wake.
2. Brian | June 14th, 2008 at 12:31 pm
Unfortunately, we’ve seen WSTM in this near-death state for about 7 years now. Somehow they continue to stay (low) on the radar and continue on. I’ve called for their end many times and missed, but this time I think it’s finally the termination of a terribly mismanaged and textbook case of how not to execute a roll-up strategy.
Some sort of liquidation for pennies on the dollar is all I can see at this point.
3. TM Commentator | June 16th, 2008 at 7:08 am
Workstream’s unabashed attempts to manipulate the market price of their stock is amazing. This morning’s “pre-release” (5 weeks early) of (presumably unaudited) financials is a clear attempt to preserve their two-bit or so stock price. In the meantime, virtually all of their talent has left, either voluntarily or been fired. What’s left?
4. Tim Giehll | June 17th, 2008 at 8:14 am
At this point, what do you all think a buyer would need to pay for WorkStream and what would be left to buy?? Just wondering??
5. Jason Corsello | June 17th, 2008 at 8:57 am
Tim-
Workstream’s market cap (value) as of today is $17.2 million. Obviously I would think the Workstream board thinks its undervalued. At the same time though, the company also has about $31m in liabilities/debt. Potential buyers can make their own assessment of value.
Jason
6. Tim Giehll | June 17th, 2008 at 11:47 am
How many employees do you feel are still remaining at Workstream?? Any breakdown on that??
7. Misha | June 17th, 2008 at 1:37 pm
you know Workstream is actively recruiting?
8. Current Employee | June 24th, 2008 at 11:07 am
Truth be told many of troubles WSTM faces are very much of its own making. Mis-management, short sited strategies, and poor assimilation of acquisitions have clearly outdone quality products and service offerings. While the current stock price is troubling we are in fact actually stronger in many ways than we were in my three years + with the organization. Our new release though clearly late out of the gate is indeed every bit or better than we promised, our client relations have improved significantly, and our management team is making strong but conservative steps to get in the right direction. I really see very little chance of the organization going out of business. De-listing though a concern is not terribly worrisome. Being bought out for a pittance of our value is a real concern especially to employees who might or might not be in the mix post sale. 90% of vendors would have better software out of the gate than they do now with a purchase of Workstream for little more than its technology alone. At the price they could get it I’d be shocked if someone doesn’t bite soon. A smart company would buy Workstream, take its version 7 code product set, and shelve its own software at a fraction of what it would cost them to upgrade their product set to what we have already done with ours. Minus the baggage that we harbor the product set could easily win head to head vs. the majority of the competition every day of the week.
9. Current Employee | June 24th, 2008 at 11:14 am
There are about 160 current employees down from about 200 at the height of expansion. Frankly, WSTM was run exceptionally poorly and deserves its current fate. That said the products and most of the people are fantastic. I have little concern about the company going out of business as the financials are trending up, are customers are buying from us after years of being basically ignored, and additional funding is available. The issue is how will our financials impact our ability to close business and when and who will look to acquire the organization next. Technology companies never completely die…they just change names and hands. Example: Empagio and its many spare parts.
10. Cindy | October 22nd, 2008 at 11:31 am
Another deep lay-off this Monday has now made it apparent that Workstream is not even trying to remain viable in the talent management software space. They have even cut off the sales of new deals and of their new V6 software. Sad as their products are pretty solid. You would hope a sale of their software division would happen, but it appears as though management may not want that no matter the consequences in an attempt to retain authority.
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