November 17, 2008, 12:00 AM

E-commerce software vendor LaGarde seeks sale to rival Dydacomp

LaGarde Inc. has filed for bankruptcy protection with the aim of selling the company’s assets to Dydacomp, says CEO Bob LaGarde. Dydacomp is a provider of order management and e-commerce technology to online and catalog retailers.

LaGarde Inc., which has been supplying e-commerce software to small online retailers since 1996, has filed for Chapter 11 bankruptcy protection while it seeks to negotiate a sale of the company’s assets to e-commerce software provider Dydacomp, says LaGarde CEO and founder Bob LaGarde.

The deal could be completed by mid-December, LaGarde says. He says Dydacomp would continue to support LaGarde’s two platforms, its older StoreFront product used by more than 5,000 smaller online retailers, LaGarde says, and its newer, hosted Phoenix platform.

However, a senior Dydacomp official says he is not aware of any plans to acquire the LaGarde assets. “From Dydacomp’s standpoint there’s no news to report at this time,” says Rob Coon, president of Dydacomp, best known for its order management software Mail Order Manager.

LaGarde says the company’s troubles stem from poor performance in 2007 as it was developing the new Phoenix platform aimed at mid-sized e-retailers. LaGarde had given up his CEO position in 2006 to Joe Whelan and the company in early 2007 raised $6 million in venture capital. After the company missed its 2007 performance goals “by a very, very wide degree,” LaGarde says, he returned to the helm of the company in January 2008. The company struggled with the debt burden it had accumulated, and the economic downturn this fall limited its options, LaGarde says.

Nonetheless, LaGarde says he is excited about the possibility of joining forces with Dydacomp. “We’ve had several suitors over the past several months and the deal we are working to complete with Dydacomp is the deal most favorable to clients, creditors and employees,” LaGarde says. He says it is not clear whether he and Lance Hemenway, his chief strategy officer who was hired in May, would remain with the company if the sale goes through.

The company now employs about 35 individuals, down from over 120 in early 2007 after the company received venture capital funding.

The three online retailers live with LaGarde’s software-as-a-service Phoenix platform, LaGarde says, are: a Boy Scouts of America popcorn site through a deal with Weaver Popcorn Co.; health food retailer Sunfood Nutrition; and Teamerchants.com, the e-commerce site of German tea retailer TeaGschwender. He says six other retailers are in the process of deploying the Phoenix technology.

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