Dayton, Ohio-based data-warehousing giant Teradata Corp. plans to sell its Marketing Applications unit, which previously was known as Aprimo, the fast-growing Indianapolis-based marketing software company it bought for $525 million five years ago.
The struggling Ohio company announced the plans to sell the business unit Thursday at the same time it reported disappointing third-quarter financial results. Teradata did not disclose whether it had a buyer lined up, and it provided no details on the immediate future of the subsidiary's employees in Indianapolis and elsewhere.
Teradata shares plunged 14 percent Thursday to a six-year low, closing at $25.58 each.
CEO Mike Koehler said in written remarks that executives were "making transformative changes to the company for longer term success" and "aligning our cost structure for near-term improvement."
"As part of our business transformation, we determined it best to exclusively focus our investments and attention on our core Data and Analytics business. We are therefore selling our Marketing Applications business," he said.
The company would not disclose how many employees it has in Indianapolis. But Aprimo employed about 400 people at the time of the acquisition in December 2010 and had plans to hire another 500, a plan that Aprimo executives said remained intact after the buyout.
Teradata employed about 6,000 people worldwide in late 2010 and has a global workforce of about 11,000 today. It reported having 222 software engineers or programmers in Indianapolis in 2012.
It's unclear if any layoffs will be associated with the restructuring.
"They just announced it; the decision was just made," Teradata spokesman Mike O'Sullivan said in a phone interview Thursday. "So really there are no details at this time."
Co-founded in 1998 by tech veteran Bill Godfrey, Aprimo was one of the area's fastest-growing startups during the 2000s. It and ExactTarget were among the power hitters on the roster of Indianapolis marketing software firms.
It raked in about $69 million in revenue in 2007, the year it filed for an initial public offering. It withdrew the offering because of the sinking economy, grew revenue 32 percent more and then got scooped up by Teradata in a wave of marketing software acquisitions across the country.
The buyout pumped millions of exit capital into central Indiana's economy, some of which Godfrey and other former Aprimo executives have injected into new startups.
O'Sullivan said Teradata invested in Aprimo operations after it bought it, opening offices for the unit across the globe. It took the core unit and "broadened it and deepened it," he said.
Former Aprimo employees who asked not to be named said the unit still has market-leading software and that industry is growing. But Aprimo proved not to be a good fit Teradata, which is struggling on multiple fronts.
Teradata's third-quarter revenue fell 9 percent from a year earlier, to $606 million, it said Thursday. Its data and analytics business also slipped 9 percent, to $557 million, in the quarter, and its marketing applications business fell 8 percent, to $49 million.