As its corporate parent spent four months considering a proposed buyout, uncertainty weighed on the Raleigh software company's business. New sales faltered as some customers waited to see the outcome of the negotiations or opted for competitors' products.

"I think it happened at an inopportune time, because I thought we had some great momentum," said Tom Skelton, CEO of Misys Healthcare Systems and a member of parent Misys PLC's board of directors. "The great news is now we're moving beyond that."

Ultimately, Misys PLC failed to receive a satisfactory offer, and its founder and CEO resigned. The company hired IBM veteran and former Siebel Systems CEO Mike Lawrie last month as its new chief executive.

Lawrie, who started Nov. 1, today makes his first visit to the health-care division's global headquarters in Raleigh. He's visiting each Misys office, meeting management teams and learning about the company's culture to understand what he should do to make sure the business is successful, Skelton said.

Investors have been concerned for some time that Misys PLC, a software conglomerate focusing on banking, securities and health care, was falling behind its competition, said Kevin Ashton, director of equity research at London's Bridgewell Securities. "It's a breath of fresh air to have a new guy in charge," he said. "I've certainly got an open mind now."

But it's too soon to say what changes Lawrie might make to the health-care business, Skelton said. The new CEO has a good understanding of information technology systems and strong international experience, he said.

"He's a player. He's got credibility," Skelton said. "That's really what we need right now as a business."

The health-care division's sales grew 9 percent in the fiscal year that ended just days before the June 9 management buyout proposal, and business was looking strong.

But the offer brought with it a ban on most of Misys' external communication. That ban, in turn, exacerbated an already uncertain situation for doctors' offices and hospitals considering Misys' electronic medical records software.

Uncertainty

The software industry is particularly vulnerable to uncertainty. Organizations pay, not only for software's current capabilities, but for its future versions and enhancements, said Ronald Williams, a professor at the University of North Carolina's Kenan-Flagler Business School and an information technology consultant.

"If a company changes direction, it leaves customers uncertain of whether or not the software is going to go where the company has originally said it's going to go," said Williams, who worked for IBM for 35 years. "Under that circumstance, it tends to put buyers on hold."

The situation also gave some small competitors the chance to make inroads at small doctors' practices, Skelton said. Increasing pressure in competing for small practices significantly held back the division's new business wins in the first quarter, Misys PLC reported in October. Revenue is on par with last year.

"We haven't been able to tell our story very loudly or very effectively," Skelton said.

Now that the communication ban has ended, Misys will be more proactive in telling its story to potential customers, he said.

"We're a stable partner, a reliable partner, and if you're looking to make a seven- to 10-year play, we're the kind of company you want to make it with," he said. "Those are the types of things you'll see us get out there."

Downplaying the risks

It's a message Skelton and his executive team have been conveying quietly all along. Over the past four months, between trips to London to evaluate business proposals, Skelton has been on the road meeting with potential customers, answering their questions and downplaying the risks of doing business with Misys.

Meanwhile, Skelton tried to reassure Misys' 800 employees in Raleigh -- without breaking any confidentiality rules -- and keep them focused on serving customers.

"It can be very distressing to be in a situation where your company is in bid talks," Ashton said. "I imagine they're relieved ... all that nonsense is finished."

There's still the possibility of major change within the company, particularly if Lawrie decides to break up the conglomerate, Ashton said. The CEO told the Financial Times last month that, in the long term, "everything is on the table."

A "de-merger" probably would result in Misys Healthcare Systems being spun off as a publicly traded stock on a U.S. stock exchange, Ashton said. That would be a more attractive takeover target in the rapidly consolidating U.S. health-care industry, he said.

But the analyst doesn't anticipate attempts to sell parts of the business any time soon. As this summer showed, "there's simply an absence of buyers," he said.