Where Does Kronos Go From Here?

Mar 28, 2007 Posted by

Where does Kronos go from here? That is the question I have been getting in the past few days regarding the announcement the company will be taken private by private equity firm, Hellman & Friedman.

While I was somewhat shocked by the announcement, it is speculated that a handful of other software companies where interested in the deal, presumably ADP and Oracle (from my understanding, price is what ultimately won the deal).

So where do they go from here? There are two potential paths…

  1. The PE firm, rapes the company of cash (in the form of management fees, of course), loads up on debt, and returns the company back to the public markets
  2. The company maintains its “first billion dollar HCM company” strategy and continues to focus on growth via acquisition and greenfield opportunities

While PE’s more recently have had a track record for option #1, I am still unclear on what to expect. The tell-tell sign of future strategy will be if we see a mass exodus of sales and executive ranks. Although I don’t expect a massive overhaul of the management team you can almost never predict what will happen.