CA to buy Realogic in move to expand services division
Acquisition Vendor says purchase of software consultancy will not lead to redundancies.
Computer Associates (CA) restated its commitment to establishing anead to redundancies. autonomous services operation last week after revealing its intention to acquire Ohio-based software consultancy Realogic for an undisclosed figure.
The deal was seen as part of a strategy to develop CA's Global Professional Services (GPS) division, which it hopes will generate $1 billion in revenue by 2000. The unit accounts for less than two per cent of the company's income.
CA indicated this was the first of several planned acquisitions which, together with a greater emphasis on channel partnership, would allow the company to realise burgeoning service opportunities.
Chris Wagner, executive vice president for GPS, said the service business would work on a 'product agnostic' basis.
He said: 'We are building a service company totally independent of our product business. If a customer wants to develop on Oracle we would not try to force them to switch to Unicenter.'
Realogic, founded in 1993, generated revenues of $42 million last year and employs 350 staff. David Snyder, Realogic president and chief executive, said a proposed IPO in May had prompted acquisition offers from half a dozen suitors. He chose CA because of its commitment to independent services.
'We are like a Lambourgini without any gasoline,' said Snyder. 'We have been growing, but we needed a deal like this to ensure our growth going forward.'
Realogic specialises in installing workgroup systems, wireless communications, e-commerce and packaged applications. Snyder said although Realogic had only marginal experience of CA's flagship systems management product, Unicenter, his staff would adopt the technology 'where necessary'.
The firms said there would be no redundancies as a result of the takeover.
Snyder, who will head the subsidiary, said: 'This is a service acquisition - the people are the resource not the products.'