FRAMINGHAM (02/18/2000) - Customers could wind up with a more complete set of products with application development, storage management and business intelligence features if Computer Associates International Inc. can execute its $4 billion proposed buyout of Sterling Software Inc. effectively.
CA, which announced the deal last week, claims there is very little overlap between the firms' wide-ranging product lines. CA plans to share specific product integration plans once the deal is completed, possibly in time for the company's annual customer conference in April.
One Sterling customer says that despite hearing others gripe about the way CA has handled some past acquisitions, he considers consolidation among his suppliers to be a fact of life. "It doesn't matter who owns the company, as long as you get the support and help," says Ron Brunetti, an IS manager at Allendale Mutual Insurance, a risk management company in Johnston, R.I.
Brunetti's company uses TCPaccess, a product Sterling itself obtained through its acquisition of Interlink.
Among the Sterling products most coveted by CA are storage management offerings, including a product called IntelliSAN that lets users share files and transfer data at high speeds across storage-area networks. Sterling also offers OS/390 disk management tools that would help round out a CA storage product line, including tape and optical storage management products for the OS/390 and other systems.
In addition to having a one-stop shop for storage management products, customers could also benefit from the combination of technologies such as Sterling's Eureka enterprise information portal and CA's Neugents. Neugents, based on neural network technology, could be used to help analyze huge amounts of information accessed through the Web-based Eureka for such purposes as predicting the buying behavior of customers. Neugents could also help enable Sterling's Solve management products to predict network outages or perform other jobs.
Sterling's products should strengthen CA's lineup of mainframe software offerings, says Paul Mason, an analyst at International Data Corp., a Framingham, Mass., market research firm. He thinks CA might even be inclined to encourage users of its products to move to Sterling's Solve line, which includes SNA-to-IP migration tools.
CA also claims the deal will bolster its ability to help customers build e-business applications. CA will look for ways to integrate its Jasmineii line of XML-based Internet application tools with Sterling's Cool development tools to make it easier to build applications that give Web users access to more back-end data sources.
CA, which has made dozens of acquisitions over the years, says the Sterling deal would be the biggest dollar deal ever in the software industry. The company made the same claim last year when it bought Platinum for $3.5 billion.
Sterling generated more than $800 million in revenue during its 1999 fiscal year.