CA says its decision to divest its arcserve data protection business to Marlin Equity Partners will create new opportunities for the companies' partners.
CA Technologies has announced it has entered into a definitive agreement to divest its CA arcserve data protection business to Marlin Equity Partners. The transaction is expected to close in the second quarter of fiscal year 2015, which began in July, with the new company emerging at that time. Further terms of the acquisition were not disclosed.
Arcserve was one of CA’s oldest products, originally developed by Cheyenne Software in 1990, and acquired with Cheyenne by the then-named Computer Associates in 1996. Those were the days when Computer Associates acquired a vast smorgasbord of different products, and through two name changes the company continued to sell a large array of wares, notwithstanding its core focus on enterprise infrastructure applications. Under new CEO Mike Gregoire, CA Technologies has been streamlining around its core competencies. Data modelling solution ERwin, another long-time major channel product, was sold to Embarcadero Technologies earlier this year.
“Over the last couple years, since Mike Gregoire has been on board, CA has been on a journey to sharpen its focus on core areas, and things like the data protection business don’t fit,” said Chris Ross, VP of Worldwide Sales for Data Management Business at CA Technologies. Ross, the other senior executives, and the entire arcserve sales, marketing and product development teams – about 500 people in all – will all be moving over to the new company, which will be called arcserve. The new arcserve will be led by Mike Crest, the GM of the present arcserve business unit.
“For a number of years arcserve has been an independent business unit within CA, where we have had shared services around finance, HR and facilities,” Ross said. “All of the current arcserve dedicated team will move across to the new dedicated company we are setting up, and we now have to get these functions which we shared with CA up in the new company as well.”
The departure of arcserve means that the last major channel-only business within CA Technologies is gone, but Dodd said that CA’s moves to expand the solutions its partners are allowed to sell won’t change, and that CA Technologies remains committed to partners.
Dodd said the new arcserve will benefit both from the stability of the old business, and the new opportunities that will come with independence and a strong new financial backer.
“Having an organization that brings a huge heritage into a new, more agile, maniacally focused organization is exciting from whichever angle you look at it,” he said.
“Mike Crest has been the GM of this business for some time, and the senior leadership team has been working on this,” Dodd added. “We will all transition to the new company, Partners know us and trust us. We’ve built up a lot of trust in the channel and that will continue.”
Dodd said arcserve partners will benefit in several ways.
“Spinning off this business gives us further opportunities, especially with our new financial sponsor, Marlin Equity, to continue to invest in the technology portfolio,” he said. “The very strong backing from Marlin will give us new advantages.”
Dodd also said the new company will have the advantage of superior focus.
“The arcserve business will be 100% focused on data protection, rather than being a relatively small part of a very large software company,” he said. “With that will come stronger development focus and a focus on execution. Partners will see further improvements in our two-tier channel model. Everything being sold from this channel model was a differentiator within CA. Now we will be revising and rolling out programs to address the needs of partners. The new development focus will also assist partners.”
On the heels of the recent introduction of the next generation arcserve Unified Data Protection product, which unified all the different arcserve products onto a single platform, Dodd said the new company is poised to take advantage of changes in the market.
“It’s a perfect storm,” he said. “Analysts anticipate that as much as 30% of the backup market could be changing vendors over the next three years. This is a great opportunity for partners. If they aren’t engaged with us today, they should be thinking about it. We may be new kids on the block as an independent company, but our heritage, size, scale and momentum are things the market needs to look out for, as we will be poised to take share.”