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CA begins rebranding as rumors swirl

Newsday Staff Writer

January 30, 2007

As CA Inc. today undertakes a major product rebranding effort that will see a gradual phaseout of such staple software names as Unicenter, BrightStor and eTrust, the company is once again the subject of unconfirmed speculation that it is a takeover target.

CA yesterday declined to comment on a report that two private equity firms, Texas Pacific Group and Silver Lake Partners, "have surfaced as possible buyers," according to news site. Spokesmen for the private equity firms yesterday declined to comment.

Several people familiar with CA and the private equity firms yesterday said they were skeptical of the report.

"There's always been talk [of possible suitors] but there is no specific buzz" now, said an investment industry source who declined to be identified. In 2004, Newsday reported that CA had been shopped around to several large rivals, including Hewlett-Packard Co., but no offers materialized.

But investment banker Gary Lutin, who runs a CA shareholder forum, said given CA's share price hovering in the $25 range, "It's virtually inconceivable that somebody isn't thinking about" a CA buyout. And while an offer doesn't appear to be on the table, Lutin added, "I expect the board would be receptive to any reasonable offers, both as a responsibility to shareholders and a dignified exit for themselves."

Yesterday, CA spokesman Dan Kaferle said the company does not comment on "rumor and speculation." He said its competitive, financial and product positions "are strong."

But Kaferle confirmed the company is moving to a "master brand" strategy. The effort, according to a source, will see subbrands such as Unicenter and eTrust replaced over more than a year's time by the CA brand. In addition, newly acquired names such as eHealth and PestPatrol also will be phased out.

The source indicated the transition for some products would take place over the next 18 months. In addition to playing up the CA brand, products also will include a word or phrase that describes their function. Accordingly, a product today known as eTrust Directory will become CA Directory.

The strategy as it has been communicated to CA partners is designed to make it easier for CA customers to identify and buy the software, and more quickly recognize its value.

"Research showed customers weren't associating the sub-brands with CA and the products we offer," CA spokesman Bob Gordon said last night.

CA over more than a quarter century has acquired more than 100 companies and annexed or developed more than a thousand products, and top executives have long bemoaned the task of corralling that unwieldy portfolio into a cohesive marketing message.

Still, master-branding the products also carries risk. CA, and the predecessor companies that owned the products, spent untold millions advertising and marketing the brands.

Names such as Unicenter and eTrust have deep recognition in the industry. CA has acknowledged as much in communications with partners, saying the transition will take place over the natural product development cycles. The company has said it is being "careful to transition the equity of the more well-known names" to the CA brand.


Copyright Newsday Inc.



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