Compuware Corp. paid $256 million in cash to acquire dynaTrace Software, a company backed by Bain Capital Ventures and Bay Partners. Boston-based dynaTrace, a provider of application performance management systems, has 180 employees. Practically all are expected to remain with Compuware, the company said Wednesday. Bain Capital Ventures invested in dynaTrace in mid-2006.
Compuware Corporation (Nasdaq:CPWR), the technology performance company, today announced that it has acquired privately held dynaTrace software. The $256 million cash acquisition closed on July 1, 2011.
“Organizations today depend on the rapid development and delivery of high-performing applications to drive revenues, customer satisfaction and brand,” said Compuware Chief Executive Officer Bob Paul. “To meet these demands effectively, IT organizations must have visibility into the performance of every transaction, from development, through test and in production. Together, Compuware and dynaTrace APM solutions allow IT to meet business demands for performance and agility through unbeatable insight into the user experience — whether in cloud, complex or traditional environments.”
Headquartered in suburban Boston, dynaTrace employs 180 people around the world. Substantially all of these employees, including the leadership team, are expected to remain with Compuware. dynaTrace has a 92-percent win rate and a five-year CAGR of 125 percent because its unique PurePath technology solves the multi-billion dollar problem of optimizing application performance in a different and better way.
“The APM market is undergoing a transformation; old tools simply can’t meet the competitive requirements of modern applications,” said John Van Siclen, Chief Executive Officer of dynaTrace software. “Compuware sees the same market shift and is committed to building next-generation APM solutions that bring customers greater value, with less effort, faster than ever before. We’re excited to be a part of the Compuware team, which will allow us to meet and increase the skyrocketing demand for dynaTrace solutions.”
dynaTrace has trailing twelve month revenues of $26 million and will add between $35 and $45 million to Compuware’s FY ’12 revenues. In FY ’13, Compuware expects it to add nearly $100 million to the top line.
Due to purchase accounting, the acquisition will have a three cents per share negative impact on Compuware’s expected FY ’12 EPS. In FY ’13, the impact is expected to be at least four cents per share positive. These estimates reflect the long-term value of Compuware’s investment strategy to become best-in-the-world in the APM market.
For complete details about how this agreement raises the bar for optimizing application performance, visit http://www.compuware.com/dynatrace.
dynaTrace was founded by Bernd Greifeneder, Sok-kheng Tang and Hubert Gerstmeyer in 2005. Ben Nye at Bain Capital Ventures invested in dynaTrace at its founding, and Salil Deshpande of Bay Partners joined the company’s board in 2008. Pacific Crest Securities served as the advisor to dynaTrace on this transaction.
About dynaTrace software Inc.
dynaTrace is the new leader in application performance management (APM). With its patented PurePath technology, the company offers the only continuous APM system on the market, transforming how applications are built, tested and managed. Hundreds of companies including Zappos, SAS, Macy’s, BBVA and Thomson Reuters rely on dynaTrace to drive better business results by optimizing performance, accelerating time-to-market for new releases, reducing application management costs, and bringing business and IT closer together. Visit dynaTrace online at www.dynatrace.com.
Compuware Corporation, the technology performance company, provides software, experts and best practices to ensure technology works well and delivers value. Compuware solutions make the world’s most important technologies perform at their best for leading organizations worldwide, including 46 of the top 50 Fortune 500 companies and 12 of the top 20 most visited U.S. web sites.