Computer Associates and Concord Communications have signed a definitive agreement for CA to acquire Concord in an all-cash transaction.
The transaction is valued at $17 per fully diluted common share, or approximately $330 million. CA will also assume approximately $20 million in net debt from Concord for a total purchase price of $350 million.
The acquisition, which is subject to customary regulatory approvals and the approval of Concord’s shareholders, extends CA’s leadership in the global enterprise management market. Concord’s eHealth technology, which provides proactive network performance management and predictive capacity planning, has been widely embraced by telecommunications companies, service providers and enterprises around the world.
In addition, Concord’s service management offering provides complete management of leading-edge technologies, including VoIP (Voice over IP) and wireless mobile networks, strategically placing its solutions in the emerging high-growth network services market.
“With CA’s acquisition of Concord, we can provide our mutual customers with the broadest and deepest enterprise systems management offerings in the industry,” said CA President and CEO John Swainson. “This strategic combination significantly advances CA’s position in the high-growth network and systems management marketplace, and, with the integration of our Unicenter solutions, will extend CA’s overall leadership in systems management.”
Concord recently acquired Aprisma Management Technologies, Inc. and its SPECTRUM Business Service Intelligence software, which manages the availability of IT infrastructures and the business services that rely on them. SPECTRUM’s sophisticated service modeling and patented technology in the areas of root cause analysis, relationship mapping, impact analysis, topology discovery, and condition correlation will be of significant value to CA customers as part of the company’s Unicenter solutions portfolio.
“This strategic acquisition is expected to be a big win for Concord’s customers,” said Concord Chairman, President and CEO Jack Blaeser. “The integration of these two companies’ people and technology — Concord’s market- leading intelligent software solutions that proactively manage business services, with CA’s Unicenter suite of management products — will create a powerful and unique resource to address the evolving challenges of organizations that depend on the reliable, efficient operation of highly complex IT environments.”
The acquisition is expected to be completed within three to four months, pending regulatory approval and the approval of Concord’s shareholders. The acquisition is expected to be neutral in fiscal 2006 and slightly accretive in fiscal 2007.
Concord’s operations will be integrated into CA’s newly created Enterprise Systems Management Business Unit, headed by Senior Vice President and General Manager Alan Nugent. Combined with Unicenter, CA’s best-in-class enterprise systems management offering, these technologies will provide CA and Concord customers with the broadest and deepest solutions to manage their IT infrastructure.
It is anticipated that the vast majority of Concord’s approximately 640 employees will remain with CA after the completion of the transaction.
Murdok | Breaking eBusiness News
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