Monitoring software developer BMC Software has expanded prediction capabilities for its systems management product following the acquisition of BGS Systems for $285 million.
The buy was part of Texas-based BMC's continuing strategy to target the open systems market and will allow it to integrate its systems management suite, Patrol, with BGS' Best/1 performance analysis and prediction technology.
BMC claimed this combination will create the industry's first application service assurance products.
Paul Mason, analyst at IDC, said the deal will bring the same analytical capabilities to client-server systems that have long been possible on mainframes.
'Previously, it was limiting itself to performance management in a reactive sense. Now it is adding some predictive features,' Mason said.
James Ormerod, marketing director at BMC Software UK, said: 'The merger puts BMC in a strong position in the performance market and will enable us to concentrate on the open systems side, which forms an increasingly large part of our business.'
As a result of the acquisition, both companies' channels will be merged.
While BMC has about 200 partners, BGS has operated with far fewer, including distributors. However, a representative for BMC admitted BGS relied more heavily on distributors and this policy would now be reviewed.
A representative at BGS conceded that the company has experienced product marketing problems in the past and BMC will hope to ramp up revenue fairly quickly.
BGS shareholders will receive BMC Software shares valued at $45 per BGS share under the deal, which is subject to shareholder and US regulatory approval. The transaction is expected to be completed within 60 to 90 days, but full integration between the two companies is expected to take about 18 months.
The BGS name will disappear, although the Best/1 brand and product line will continue. Total revenue of the joint organisation for the calendar year 1997 is expected to reach $730 million.
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