Joint Status For Two Tax Software Leaders
The market for personal-finance software is among the hottest in all of consumer software. Now, two of the leading companies are joining forces, solidifying their dominance in the popular tax-preparation software niche. On Apr. 12, San Diego-based ChipSoft Inc. announced its plan to acquire MECA Software Inc. for $58 million. ChipSoft makes the No.1 program, TurboTax, while MECA, based in Fairfield, Conn., produces the No.2, TaxCut--as well as Managing Your Money, a personal-finance program.
The combined company will have about $80 million in annual sales, posing a direct challenge to Intuit Inc., whose Quicken program leads in the personal-finance management category. Analysts believe the market for all such programs is growing at more than 30% annually. Within that group, tax programs are expected to do particularly well, given President Clinton's plans for higher taxes. It's likely that ChipSoft and MECA will continue to offer each of their programs following the merger, with TurboTax aimed toward the sophisticated planner and TaxCut geared for neophytes.
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