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CA Buys Enterprise Software Vendor in $350 Million Deal

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Posted March 10, 2010 By Larry Barrett     Feedback

CA makes another cloud computing acquisition, picking up IT performance and availability monitoring software vendor Nimsoft in all-cash deal.

CA on Wednesday announced that it will acquire Nimsoft, a privately held developer of IT performance and availability monitoring software, for $350 million in cash.

Redwood City, Calif.-based Nimsoft's Unified Monitoring architecture helps enterprise customers deploy and monitor public and private clouds as well as Software-as-a-Service (SaaS) implementations.

"With our planned acquisition of Nimsoft, CA will be equipped to capture several important growth market segments, including emerging enterprises, emerging national economies and the MSPs who are providing these customers with IT management services via the cloud," Chris O'Malley, CA's (NASDAQ: CA) executive vice president of cloud products and solutions, said in a statement.

"Penetration of these markets will further expand our global leadership in IT management and complement our existing strength with large enterprise customers," he added.

Nimsoft's customers include the likes of Google (NASDAQ: GOOG), Amazon (NASDAQ: AMZN) and Salesforce.com (NYSE: CRM).

CA estimates that emerging enterprises, which it categorizes as organizations with annual sales of between $300 million and $2 billion, will account for approximately 25 percent of the software spending in CA's market space by 2013.

In February, the Islandia, N.Y.-based company bolstered its cloud-computing portfolio by acquiring 3Tera, a developer of software applications used to build and deploy applications for public and private clouds.

Financial terms of that purchase were not disclosed.

3Tera's AppLogic software allows companies to use a browser to manage and scale on-demand, fully distributed applications for both in-house clouds and as a platform for cloud-computing services.

Software pundits predict cloud computing will be one of the fastest-growing markets in 2010 as enterprise customers embrace the cheaper, greener and more efficient distributed computing platform.

Gartner predicts cloud-computing sales will surge to more than $150.1 billion in 2013, up from roughly $60 million last year and $46.4 billion in 2008.

CA has made a number of cloud-computing acquisitions in the past two years, including the September purchase of network performance management software developer NetQoS, a pick-up that resulted in an additional $10 million in sales during its third quarter.

In June it snapped up Cassatt, a provider of cloud-computing software that makes data centers more efficient. In January CA bought Oblicore, a developer of service level management applications (SLM) for the cloud.

CA officials said the Nimsoft deal will likely close by the end of its fourth quarter ending March 31, and is expected to have minimal impact on 2010 results and be dilutive to earnings per share in 2011.

CA shares closed off $0.27, or 1 percent, to $22.60 a share in Wednesday trading before slipping another $0.19 in after-hours trading.

Larry Barrett is a senior editor at InternetNews.com, the news service of Internet.com, the network for technology professionals.

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