March 11, 2010, 4:11 PM — CA said Wednesday it has signed a deal to buy IT performance monitoring vendor Nimsoft for US$350 million.
The acquisition, which is scheduled to close this month, will strengthen CA's hand in IT management software for what it calls "emerging enterprises," or companies with annual revenues between $300 million and $2 billion, and for managed service providers.
CA's move into the midmarket represents a change from its core business of serving large enterprises. Nimsoft also has an active presence in cloud computing, with offerings for Rackspace and Amazon's Elastic Compute Cloud, among others.
The acquisition is just the latest for CA, which also recently bought network performance management vendor NetQoS, as well as Oblicore, a maker of software for monitoring service level agreements. Last month, it announced plans to acquire 3Tera, maker of a platform for deploying and scaling cloud applications.
Nimsoft has about 800 customers, mainly in the U.S. and Europe. Most of its 120 employees, including CEO Gary Read, will move over to CA under its Cloud Products and Solutions division. Its products will continue being sold under a subscription model, according to CA.
Nimsoft agreed to the acquisition because it will help it grow more quickly, Read said in a blog post Wednesday.
"The market is moving so fast and changing so rapidly, that I was concerned that Nimsoft could not, by itself, keep up," he wrote. "We were already hiring additional sales people and engineers as fast as we could, but there is a natural limit to how rapidly you can scale a business without breaking those things that are important to us, customer satisfaction being [at] the top of the list."
But Nimsoft has also been competing successfully against the "big four" IT management vendors -- BMC, Hewlett-Packard, IBM and CA itself, wrote Joe Panettieri at MSPMentor.net, a managed services specialty news site.
Therefore, the Nimsoft buy "kills two birds with one stone," he wrote. "First, CA eliminates a competitor. Second, CA moves into the fast-growing managed services market."