Whitehill Acquires InSystems
Whitehill Technologies (Moncton, New Brunswick) acquired document automation software provider InSystems to provide a more comprehensive document management solution and increase Whitehill's footprint in the insurance vertical, according to Paul McSpurren, Whitehill's president and CEO. "The combined company's critical mass will be nearly 1,000 customers strong, including several hundred insurance companies," he says.
Markham, Ontario-based InSystems was acquired by Standard Register (Dayton, Ohio) in 2002 for $89 million. While terms of InSystems' sale to Whitehill were not disclosed, industry observers agree that InSystems will be a better fit with Whitehill. "It raised a few eyebrows when Standard Register bought InSystems," says Craig Weber, a San Antonio-based analyst with Celent. "It's hard for nonsoftware companies to appreciate what an affiliate company that manages software is doing. It's not surprising to see them let go of this piece."
While nine-year-old Whitehill got its start selling data and document automation solutions to large law firms, it has ample experience in the insurance vertical, with more than 20 carrier customers across the property/casualty, life and health spectrum. That familiarity with the market will help Whitehill's chances for success, according to Weber. "It's hard to make a presence in software within insurance if you don't have a real commitment to that market," he says.
Marriage of Opportunity
Whitehill's McSpurren says that while both companies' document automation orientations made the deal a natural fit, a closer look showed further opportunity. "When we looked at what both companies were good at, it wasn't as if we were competing for the same business in [the document management] space," he asserts. "We saw the opportunity in the marriage of the two offerings to change that competitive landscape and say, 'Here's one vendor that really does have that consolidated offering.' Whether it's transactional, batch, low-volume, high-volume, complex or low-complexity documents, we have a document automation solution," McSpurren asserts.
Whitehill will leave InSystems' existing staff more or less intact, according to McSpurren. "This is much more of a leveraged growth opportunity than a strategic attempt to make two companies as efficient as one big one," he says. Nevertheless, InSystems eventually will be assimilated. "We see much value in the InSystems brand in the market, so out of the gate we will integrate the Whitehill name with the InSystems product packaging and then the brand," McSpurren says. "But over time Whitehill will be the only brand." --A.O.
Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio
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