Irvine-Based Vision Solutions Setting Its Sights on Stock Sale

By GREG MILLER

March 15, 1997 12 AM PT

TIMES STAFF WRITER

IRVINE —

Vision Solutions Inc., a rapidly growing software company, is looking to sell stock to the public for the first time and possibly raise as much as $23 million, according to documents filed Friday with the Securities and Exchange Commission.

Irvine-based Vision, whose software is used by corporations to back up and protect important data, plans to sell a 26% stake in the company, or 2.3 million shares of common stock, for about $11 per share.

The company has not set a date for the stock sale.

Vision ranked 118th on Inc. magazine’s list of the 500 fastest growing companies in the nation last year. Founded in 1991, the company’s sales have risen from $535,000 in 1992 to $10.18 million last year.

But the company has also reported losses in six of the last eight quarters and had net income of just $142,000 last year.

Vision executives will own about 67% of the company after the stock sale, and some officers could be holding stock worth millions of dollars.

Christian Turner, the company’s chief technology officer and co-founder, will hold a 29% stake after the offering. David McLelland, also a founder and executive director of product engineering, will retain 23%. Robert Zwerling, the company’s chief executive, will hold 13%.

Company officials declined to comment, saying that they have been instructed by attorneys not to speak publicly about the company’s prospects until the stock offering is complete.

Vision makes software that copies and protects data that companies need to access frequently and reliably, such as personnel records, payroll or sales orders. Vision’s customers include Kingston Technology Corp., Countrywide Funding Corp. and Cox Cable Communications Inc.

Analysts said that Vision is one of many companies in a market that has grown with the increasing use of client-server computer networks as the primary depository of their most important data.

“There is certainly room in the market,” said Adam Giansiracusa, an analyst at Volpe, Welty & Co. in San Francisco.

But there are also looming competitors with vast resources. In its filing, Vision said that 19% of its revenue came from IBM, which sells Vision products. But the company also said that IBM is a potential competitor. Other rivals include Digital Equipment Corp. and Veritas Software Corp.

Vision was founded in December 1991 in Brea under the name Midrange Information Systems Inc. The company changed its name to Vision Solutions last August and moved to Irvine.

Allen & Co. Inc. and Cowen & Co. are expected to underwrite the stock sale. Following the offering, there will be 8.85 million shares of stock outstanding.

Vision Solutions at a Glance

Headquarters: Irvine

Product: Computer software designed to prevent network and systems failure

Founded: 1991

President/CEO: Robert J. Zwerling

1996 revenue: $10.2 million

1996 net income: $142,000

Shares offered: 2.3 million

Estimated offering price: $10-$12 per share

Anticipated proceeds: $22.7 million

Underwriters: Allen & Co. and Cowen & Co.

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