CA Technologies (NASDAQ:CA) publicly announced that has signed an agreement to acquire Burlington security software company Veracode for $614 million cash. This report was made public on Monday, March 6th 2017.
The acquisition details
The acquisition process is expected to end by the end of the first quarter of 2018 subject to approval from the regulatory authorities and customary closing conditions. CA Technologies are listed in the NASDAQ stock site under the ticker number CA. They declared revenue of more than $4 billion in the last fiscal year, 2016. The company reported that it is hopeful that the acquisition of Veracode will increase the reported revenue between 1% and 3% in the fiscal year 2018. This is after putting into assumption that the deal closes by around April in 2018.
Veracode considered initial public offer
Reports indicate that Veracode had once considered an initial public offering between late 2014 and early 2015. The IPO would have valued the company at a range between $600 million and $800 million. The Massachusetts based company is one of the largest cyber security firms in the region. Veracode raised at least $134 million lifetime. $40 million round was led from Wellington Management Company, a Boston based investment management company. Wellington had once in the past included 406 ventures, StarVest Partners, Meritech Capital Partners and Atlas Ventures.
CA expectations from the acquisition
CA technologies serve enterprise clients by providing them with a range of software products. Veracode is expected to assist the company attract mid-size firms. They recognize the importance of software in the digitization process of companies. CA’s president Ayman stated that the acquisition of Veracode will unify the Security and DevOps portfolio in CA with a SaaS-based site that completely integrates the security system into the ideal software development process. This will leave CA as the leader in the market through the automation of and scaling of (AST) Application Security Testing.
The largest tech deal
The CA and Veracode acquisition is reported as the largest tech deal to happen in the state ever since Hewlett Packard Enterprise publicly reported its intention to acquire SimpliVity. The deal was worth $650 million.