NEWS Computer Associates International on Tuesday announced that it is selling 90 percent of its stake in the subsidiary ACCPAC International to the United Kingdom-based Sage Group, the parent company of Best Software, for an equity value of $110m.
The deal is part of CA's plan to focus on management software and exit from other areas. Its Pleasanton, California-based subsidiary specialised in applications such as accounting, human resources and sales for small and medium-size companies.
Over the year, CA entered new areas such as web services management and utility computing.
The Islandia, NY, software maker will get about $88m in cash for its 90 percent share. The transaction, subject to regulatory approvals, is likely to close by February 2004.
The company said ACCPAC is likely to net about $28m in revenue and incur $27m of expenses before taxes for the quarter ending 31 December, 2003. This deal will affect CA's balance sheet for this and the next quarter.
Sage said the acquisition would add to its business in Australia and South Africa, and provide it an entry into Asia. In North America, it would mean the likely addition of more than 540,000 customers to Best's nearly 1.8 million small and medium-size business customers.
ACCPAC serves customers through 7,000 partners worldwide, which will now complement Best's 6,600 channel partners in North America -- with little overlap -- the company added.
Since 1998, Best has made 15 acquisitions in the North American market that are worth more than $1.4bn. "This acquisition reinforces our strength in key vertical areas while giving our customers additional quality products to choose from as part of the Best Software brand," Best CEO Ron Verni said in a statement.
"CA's strong commitment to addressing the enterprise management challenges of our customers has made us a world leader in our core management software markets. The sale of ACCPAC supports that focus," CA chairman Sanjay Kumar said.
