CA Technologies has signed a definitive agreement to acquire Rally Software Development Corp, a provider of Agile development software and services, for $19.50 per share, which equates to approximately $480 million, net of cash acquired.
The transaction has been unanimously approved by both boards of directors, and is expected to close in the second quarter of CA’s fiscal 2016.
Based in Boulder, CO, Rally has approximately 500 employees across four continents and FY 2015 sales of $88 million.
According to Mike Gregoire, Chief Executive Officer, CA Technologies, “Rally is a leading provider of Agile development software and services, with offerings that complement and expand CA’s strengths in the areas of DevOps and Management Cloud.”
He further says, “Every developer dreams of creating truly transformative software that responds to a business challenge extremely quickly. Joining forces with Rally makes this dream a possibility for millions of developers worldwide, and in turn opens up the possibility of a whole new range of experiences driven by software. At the end of the day, this deal is about enabling speed and flexibility, about how we can make the most demanding enterprises truly agile.”
With users in more than 135 countries and nearly every industry, Rally works with some of the world’s largest brands, including over 35 of the Fortune 100.
Tim Miller, Rally’s Chairman and Chief Executive Officer added, “In a world driven by software, the powerful combination of Rally and CA will help our combined customers to better navigate changing markets, improve performance and deliver value faster.”
Leading industry analysts firms like Forrester and IDC say that the Agile methodology is a major trend in developing software.
According to Forrester, 69% of respondents out of 560 surveyed decision-makers of the annual Forrester Forrsights Software Survey have interest, plan to implement, or have already implemented Agile for their custom development.
Market intelligence firm IDC expects strong growth for Agile ALM software.
In an analysis of the Agile application life-cycle management market, it reports that worldwide Agile application life-cycle management software revenue in 2012 reached $211.9 million, and, with a forecasted compound annual growth rate of 39%, will reach $1.1 billion by 2017.