CA Acquires
Privately Held Wily Technology;
Expands IT Management Capabilities
for Enterprise Applications
All-cash Transaction of $375 Million
Webcast Today at 10 a.m. EST at http://ca.com/invest
Islandia, N.Y. and Brisbane, Calif. – January 5,
2006 – CA
(NYSE:CA), one of the world's largest IT management software
companies, today announced that it has signed a definitive
agreement to acquire Wily Technology, a leading provider
of enterprise application management solutions, for $375
million in an all-cash transaction.
"Application management is key to enabling customers
to manage IT environments from end-to-end — from applications
to infrastructure — and delivering on CA's Enterprise
IT Management vision," said CA President and CEO John
Swainson. "Wily is the leader in this sector and the
fastest growing major company in a fast growing market. With
this acquisition, CA will be the only company to address
the management of applications, IT assets and users across
all hardware and software, from the mainframe to the distributed
environment."
Wily provides end-to-end visibility into
customer transactions in real time, and enables IT organizations
to successfully manage the health and availability of their
critical enterprise applications and infrastructure. Its
solutions allow IT managers to rapidly detect and diagnose
application slowdowns and failures, and better assess the
impact of application performance on business success, resulting
in better customer service and higher IT productivity.
Wily's revenues grew by
48 percent in 2004 (audited) and 2005 revenues are expected
to increase 75 percent (unaudited), a rate that is more than
three times as fast as the overall growth of its market segment.
CA expects Wily to contribute approximately $72 million of
revenue in CA's fiscal
year 2007 on a ratable basis. Billions of web transactions
a day are monitored by Wily's software — more
transactions for more customers than all its competitors
combined. Wily's technology is installed in more than
450 leading enterprises and government organizations worldwide.
Wily
is positioned in the Leader's Quadrant of Gartner
Inc.'s Magic Quadrant for J2EE Application Server Management,
2005¹; according to Gartner, leaders are vendors that are
performing well today, have a clear vision of market direction
and are actively building competencies to sustain their leadership
position in the market. Additionally, Gartner is forecasting
that the Application Management market, based on new license
revenue, will exceed $1 billion in 2007, and is estimated
to reach $1.355 billion in 2009².
"Wily has defined and become the leader in this sector
by focusing on customer success," said Wily Technology
CEO Dick Williams. "With CA, we can reach more organizations
than ever before with our innovative technology, expert people
and best practices. And, by accelerating our development
and integrating our technology with CA's solutions,
we will be able to deliver a scope of management products
unmatched by anyone else. I'm excited to be joining
the CA team and for the opportunity to build a best-in-class
enterprise management software company."
At the close
of the transaction, Wily will operate as the Wily Technology
division within CA's Enterprise Systems
Management business unit. Williams will join CA and lead
the division, and Lewis Cirne, Wily's founder and chief
technology officer will also join the Company. CA expects
to retain most of Wily's more than 260 employees. Product
integration roadmaps will be available about 30 days after
the close of the acquisition.
The acquisition is expected
to be completed within three months, pending regulatory approval,
and is expected to be dilutive to CA's earnings per
share in fiscal 2006 and neutral to earnings per share in
fiscal 2007.
Conference
Call
CA will host a conference call to discuss
the transaction at 10 a.m. EST today. Investors and media
can access the call via webcast at http://ca.com/invest,
or by calling 800 729 6829.
About the Magic Quadrant
The Magic Quadrant is copyrighted
April 4, 2005 by Gartner, Inc. and is reused with permission.
The Magic Quadrant is a graphical representation of a marketplace
at and for a specific time period. It depicts Gartner's
analysis of how certain vendors measure against criteria
for that marketplace, as defined by Gartner. Gartner does
not endorse any vendor, product or service depicted in the
Magic Quadrant, and does not advise technology users to select
only those vendors placed in the "Leaders" quadrant.
The Magic Quadrant is intended solely as a research tool,
and is not meant to be a specific guide to action. Gartner
disclaims all warranties, express or implied, with respect
to this research, including any warranties of merchantability
or fitness for a particular purpose.
About CA
CA (NYSE: CA), one of the world's largest
information technology (IT) management software companies,
unifies and simplifies the management of enterprise-wide
IT. Founded in 1976, CA is headquartered in Islandia, N.Y.,
and serves customers in more than 140 countries. For more
information, please visit http://ca.com.
About Wily Technology, Inc.
CA Wily Technology, a division of CA, is the market-leading provider of Enterprise Application Management solutions. By providing end-to-end visibility into customer transactions in real-time, CA Wily's products enable companies to successfully manage the health and availability of their critical Web applications and infrastructure. CA Wily's collaborative management approach allows enterprises to rapidly detect and diagnose application slowdowns and failures, and better assess the impact of application performance on business success. This means better customer service, more stable revenue streams, and higher IT productivity. To learn more about CA's Wily Technology division, visit http://www.wilytech.com or call 1 888 GET WILY.
- Gartner Research “Magic Quadrants for J2EE Application Server
Management 2005” by Cameron Haight. April 4, 2005.
- Gartner Research “Forecast:
Enterprise Management Software, Worldwide, 2004-2009” by Laurie
Wurster and Fabrizio Biscotti.
Cautionary Statement Regarding Forward-Looking
Statements
Certain statements in this press release regarding the proposed
transaction between CA and Wily, the expected timetable for
completing the transaction, future financial and operating
results, benefits and synergies of the transaction, future
opportunities for the combined company and products and any
other statements regarding CA's or Wily's future
expectations, beliefs, goals or prospects constitute forward-looking
statements. Any statements that are not statements of historical
fact (including statements containing the words "believes," "plans," "anticipates," "expects," "estimates" and
similar expressions) should also be considered forward-looking
statements. A number of important factors could cause actual
results or events to differ materially from those indicated
by such forward-looking statements, including: the parties' ability
to consummate the transaction; the conditions to the completion
of the transaction may not be satisfied; the regulatory approvals
required for the transaction may not be obtained on the terms
expected or on the anticipated schedule; the parties' ability
to meet expectations regarding the timing, completion and
accounting and tax treatments of the merger; the possibility
that the parties may be unable to achieve expected synergies
and operating efficiencies in the merger within the expected
time-frames or at all; CA may be unable to successfully integrate
Wily's operations into those of CA; such integration
may be more difficult, time-consuming or costly than expected;
revenues following the transaction may be lower than expected;
operating costs, customer loss and business disruption (including,
without limitation, difficulties in maintaining relationships
with employees, customers, clients or suppliers) may be greater
than expected following the transaction; the retention of
certain key employees at Wily; the risks and uncertainties
associated with the CA deferred prosecution agreement with
the United States Attorney's Office of the Eastern
District, including that CA could be subject to criminal
prosecution or civil penalties if it violates this agreement;
the risks and uncertainties associated with the agreement
that CA entered into with the Securities and Exchange Commission
("SEC"), including that CA may be subject to
criminal prosecution or substantial civil penalties and fines
if it violates this agreement; civil litigation arising out
of the matters that are the subject of the Department of
Justice and the SEC investigations, including shareholder
derivative litigation; changes to the compensation plan of
CA's sales organization may encourage behavior not
anticipated or intended as it is implemented; CA may encounter
difficulty in successfully integrating acquired companies
and products into its existing businesses; CA is subject
to intense competition in product and service offerings and
pricing and increased competition is expected in the future;
certain software that CA uses in daily operations is licensed
from third parties and thus may not be available to CA in
the future, which has the potential to delay product development
and production; if CA's products do not remain compatible
with ever-changing operating environments, CA could lose
customers and the demand for CA's products and services
could decrease; CA's credit ratings have been downgraded
and could be downgraded further which would require CA to
pay additional interest under its credit agreement and could
adversely affect CA's ability to borrow; CA has a significant
amount of debt; the failure to protect CA's intellectual
property rights would weaken its competitive position; CA
may become dependent upon large transactions; general economic
conditions may lead CA's customers to delay or forgo
technology upgrades; the market for some or all of CA's
key product areas may not grow; third parties could claim
that CA's products infringe their intellectual property
rights; fluctuations in foreign currencies could result in
transaction losses; and the other factors described in CA's
Annual Report on Form 10-K for the year ended March 31, 2005,
and any amendments thereto, and in its most recent quarterly
reports filed with the SEC. CA and Wily assume no obligation
to update the information in this communication, except as
otherwise required by law. Readers are cautioned not to place
undue reliance on these forward-looking statements that speak
only as of the date hereof. |
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