Private equity group HG Capital has outbid the Sage Group for Norwegian software and accounting firm Visma.

Sage offered nearly $600 million for the 200,000-customer company, but was topped by HG Capital's $675 million.

The Visma board had backed Sage's initial offer, made a month ago, but withdrew its support after several large shareholders balked at the deal, pointing to strong first-quarter revenues as a sign the company was being undervalued. Sage had said from the start that it would not up its offer.

HG Capital has recently bought a number of European companies that provide accounting software for small and midsized businesses -- including Iris Software in the U.K. and Addison Software in Germany. Announcing the deal, HG Capital said that it is planning to help Visma fund acquisitions in Sweden and Norway to build up its market share.

Visma is the largest Scandinavian vendor of business management solutions for small and midsized businesses. Visma's revenues for 2005 were approximately $290 million, up almost $40 million from the 2004 figures. As of December 31, Visma had gross assets of approximately $345 million.

Sage is the U.K.'s largest listed software company.

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