Computer Associates International to Buy Netegrity Inc. for 5.48 Times Revenue

Weekly Corporate Growth Report, Oct 18, 2004

The Deal: Computer Associates International has agreed to purchase Netegrity Inc. in a $430 million cash deal. Under the terms of the deal, each share of Netegrity will be exchanged for $10.75 in cash, a 39 percent premium over recent closing prices. While the deal still requires shareholder approval, shareholders representing ten percent of outstanding Netegrity shares have already agreed to vote in favor of the transaction. If the acquisition is successful, Netegrity will be integrated into Computer Associates' eTrust Identity and Access Management Group.

Discussion: Netegrity Inc. provides relationship management software used by business to to provide employees, suppliers, and partners with access to different parts of their networks. The company's software provides user authentication and access management, allowing companies to control network security. Netegrity also develops content management software and provides consulting and related services.

Computer Associates International is of the world's largest software companies. The company develops software for a wide range of business applications, including business intelligence, storage, security, and network management. Computer Associates also offers services such as consulting, implementation, and training.

The acquisition will strengthen Computer Associates' web security product offerings.