Why CA Technologies buying $88 mn revenue Rally Software for $480 mn?

CA Technologies is set to buy Rally Software Development Corp., a provider of Agile development software and services, for $480 million.

Based in Boulder, CO, Rally has nearly 500 employees across four continents and achieved sales revenue of $88 million in FY 2015.

CA Technologies is spending huge money to acquire Rally Software because it has users in more than 135 countries and nearly every industry. This apart, Rally works with the world’s largest and most respected brands, including over 35 of the Fortune 100, offering cloud-based Agile development platform.

CA Technologies is also quoting IT analysis reports from IDC and Forrester to support the strategy to acquire Rally Software by paying $480 million.

The acquisition of Rally is part CA Technologies’ strategy to help customers thrive in the application economy, in which software applications are ubiquitous – driving every facet of business in every part of the world.

“Software applications are changing the world, disrupting established business models and bringing in completely new experiences in areas from travel to banking. In order to compete, businesses need to develop high quality software quickly and reliably,” said Mike Gregoire, chief executive officer of CA Technologies.

CA Technologies CEO Mike Gregoire
Rally’s Agile development software and services complement and expand CA’s strengths in the areas of DevOps and Management Cloud.

Tim Miller, chairman and chief executive officer of Rally Software, said: “CA and Rally have more than four years of history working together, and we are thrilled to be taking this next step in our relationship to deliver unique value to both CA and Rally customers.”

Analysts firm Forrester says 69 percent 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. 63 percent of respondents of the same survey answered similarly for packaged software development and maintenance.

IDC says the worldwide Agile application life-cycle management software revenue reached $211.9 million in 2012, and, with a forecasted compound annual growth rate of 39 percent, will reach $1.1 billion by 2017.

Baburajan K
[email protected]

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