CA buys Rally Software for DevOps and cloud-based agile development in $480m deal

CA goes shopping for something more up-to-date in response to falling revenues

Software vendor CA Technologies is to acquire Rally Software Development for $480m in a bid to flesh out its agile development software and services.

CA CEO Mike Gregoire justified the deal by suggesting that software development is changing - and that CA, which has a portfolio of software tools, needs to change with it.

"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 Gregoire.

He added that Rally, as a provider of agile development software and services, would help to complement CA's strengths in the areas of DevOps and "management cloud".

"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," he said.

Based in Boulder, Colorado, Rally claims users in more than 135 countries and almost every industry, and also has a team of "transformation consultants" and "agile coaches". It achieved revenues of $88m in its fiscal 2015, following a $70m IPO in 2013.

The deal is approved by the boards of both companies and ought to close by the end of September.

CA Technologies, meanwhile, is struggling with declining revenues as sales of its portfolio of software products, many of them ageing, falls. In its full year to the end of fiscal 2015, in March 2015, revenue fell by three per cent from $4.412bn to $4.262bn as application development shifted to the cloud.

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