ISLANDIA, N.Y., Aug. 30 /PRNewswire-FirstCall/ -- CA Technologies
(Nasdaq: CA) today announced it has signed a definitive agreement
to acquire privately-held Arcot Systems, Inc., a leader in
providing advanced authentication and fraud prevention solutions
through on premises software or cloud services, in an all-cash
transaction valued at $200
million.
The acquisition of Arcot adds visionary technology for fraud
prevention and advanced authentication to CA Technologies leading
Identity and Access Management (IAM) offerings.
Arcot's solutions – delivered as cloud services or deployed on
premises – help prevent fraudulent transactions for about one
million online credit card transactions each day. In
addition, by combining Arcot's technology with CA Technologies
market-leading CA SiteMinder portfolio, the company will provide
advanced capabilities to help customers further reduce risk,
support regulatory compliance and confidently secure business
transactions.
"Arcot brings to CA Technologies a strong business in fraud
prevention and unique capabilities in advanced authentication using
a software-only approach," said Dave
Hansen, general manager for the Security business at CA
Technologies. "This acquisition adds industry-leading technology
that extends the breadth and depth of our strong IAM portfolio and
gives our customers more first-class options for securing their
Web-based business."
The acquisition builds on CA Technologies cloud security
strategy, providing the on-ramp to accelerate its delivery of IAM
solutions as a comprehensive service from the cloud. The CA
Technologies cloud security strategy is a three-fold approach:
enable organizations to extend existing on-premises IAM systems to
support cloud applications and services; provide IAM technology to
cloud providers to secure their services – whether public, private
or hybrid; and enable IAM services from the cloud.
In addition to helping customers leverage the value of cloud
computing, this acquisition is compelling from several market
perspectives:
- The Advanced Authentication market, a segment of the overall
IAM sector, is expected to grow at low double digits over the next
four years. The transaction is expected to drive new revenue
streams for CA Technologies IAM business by growing Arcot's
eCommerce transaction business and growing sales to managed service
providers that serve emerging enterprises.
- The synergies and customer benefits gained by combining
solutions from Arcot with leading IAM solutions from CA
Technologies, open strong cross-sell opportunities into both
companies' existing customer bases, as well as opportunities for
net new sales.
- The acquisition fast-tracks CA Technologies IAM cloud service
offering, with 120 million identities already verified using the
Arcot technology today.
"Identity is a critical area for security whether you're talking
about in-house or the cloud, and with 120 million identities
verified by our solutions today, we bring a strong, solid recurring
revenue base as well as sources of new growth opportunities for CA
Technologies," said Ram Varadarajan, President and CEO,
Arcot Systems, Inc. "Arcot's
strong established knowledge and expertise in core security and
fraud prevention technology -- coupled with IAM solutions from CA
Technologies -- will offer robust capabilities to our numerous
shared customers, particularly in the financial industry."
Arcot's business features a subscription-based model, with
almost 90 percent of revenue recurring and nearly 100 percent
customer retention rates. Arcot has been cash-flow positive
since the second quarter of 2009, which ended June 30, 2009.
The all-cash transaction is expected to be dilutive in fiscal
2011 to CA Technologies GAAP earnings per share and slightly
accretive to non-GAAP earnings per share. The transaction is
expected to close by the end of CA Technologies second fiscal
quarter, ending September 30, 2010,
and is subject to certain regulatory approvals and customary
closing conditions.
Founded in 1997, Arcot is a recognized visionary in the Web
fraud prevention sector. With 35 patents awarded and pending, Arcot
co-invented with Visa the 3-D Secure protocol for online payment
security.
Arcot's operations and its approximately 165 employees will
become part of the Security business at CA Technologies.
Additional resources
CA Technologies IAM / Security Solutions
Arcot Authentication Solutions
About Arcot Systems, Inc.
Arcot is the Cloud Authentication Leader. Our solutions make Web
transactions and online access safe for millions of consumer,
enterprise, and e-Commerce users. Organizations can transparently
protect their users from fraud without requiring expensive
hardware. Arcot fraud prevention, strong authentication, and
e-Document security solutions can be deployed with SaaS, internal
or mobile applications delivering the right balance of cost,
convenience and strength. Arcot investors include Accel Partners,
Granite Ventures, ONSET Ventures, SEB Venture Capital, and Vedanta
Capital, among others.
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About CA Technologies
CA Technologies (Nasdaq: CA) is an IT management software and
solutions company with expertise across all IT environments – from
mainframe and distributed, to virtual and cloud. CA Technologies
manages and secures IT environments and enables customers to
deliver more flexible IT services. CA Technologies innovative
products and services provide the insight and control essential for
IT organizations to power business agility. The majority of the
Global Fortune 500 relies on CA Technologies to manage evolving IT
ecosystems. For additional information, visit CA Technologies at
www.ca.com.
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containing the words "believes," "plans," "anticipates," "expects,"
"estimates" and similar expressions) constitute "forward-looking
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including: the ability to achieve success in the Company's strategy
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the ability to successfully acquire technology and software that
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date hereof.
Press Contacts
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Leanne Agurkis
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CA Technologies
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Corporate
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Leanne.Agurkis@ca.com
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Jennifer Hallahan
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CA Technologies
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Corporate
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Kelsey Doherty
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CA Technologies
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Investor Relations
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SOURCE CA Technologies
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