CA Buys IT Performance Vendor Nimsoft

CA announced on Wednesday that it is acquiring Nimsoft Inc., which makes IT performance and availability monitoring products for enterprises and managed service providers (MSPs). CA hopes the purchase will give it access to enterprises earning $300 million to $2 billion in revenue. The $350 million cash acquisition of the privately held company is expected to be complete by the end of the month, possibly as early as the end of next week. "Our plan is to keep Nimsoft pretty much like an independe

March 12, 2010

2 Min Read
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CA announced on Wednesday that it is acquiring Nimsoft Inc., which makes IT performance and availability monitoring products for enterprises and managed service providers (MSPs). CA hopes the purchase will give it access to enterprises earning $300 million to $2 billion in revenue. The $350 million cash acquisition of the privately held company is expected to be complete by the end of the month, possibly as early as the end of next week. "Our plan is to keep Nimsoft pretty much like an independent business unit," says Lokesh Jindal, senior vice president of Strategy and Business Development for CA. "We have no intention to disrupt any part of their business."

At least one Nimsoft customer approves of the acquisition. "Nimsoft is one of the core set of tools which underpin CDW's managed services," says Brooke Guthrie, manager of product and business management for hosting and managed services at CDW. "We don't anticipate any change to our plans for growing our use of Nimsoft's packages alongside our managed services business."

Analysts also praised the move. "This was the best acquisition CA could make to expand their market downward," which the company needed to do to maintain its growth, says Dennis Callaghan, senior enterprise software analyst for the 451 Group. The technology will also help CA as enterprises adopt cloud computing. "I would look for Nimsoft's Unified Monitoring product to be CA's go-to product for public cloud management," he says.

Some observers wonder about redundancy with CA's existing product line. "The biggest challenge I see is reconciling the product overlaps," says Jim Frey, research director for Enterprise Management Associates Inc. He says the company is trying to avoid this somewhat by bringing Nimsoft in under CA's Cloud group rather than into the Service Assurance products group. "But they will inevitably run into cases where it won't be clear which product is the best fit, and in those cases they will need a way to assure customers of an easy transition between the product lines" of Nimsoft's Network Management Solution and CA products such as CA Spectrum, CA NSM and others.

Chris O'Malley, CA's executive VP for cloud products, addressed the issue in a conference call with financial analysts on Wednesday. "There's obviously some level of overlap between that technology and what we're buying with Nimsoft," he said, according to a transcript of the call. However, CA also sees stratification in the market, with emerging enterprise customers tending toward Nimsoft. O'Malley said CA sees Nimsoft as a path to attracting those users to CA products.

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