MARLBORO, MA - Business software management company Concord Communications Inc. made its second acquisition in a month on Monday, Jan. 10, announcing it will buy Aprisma Management Technologies Inc. from Gores Technology Group LLC for $93 million in cash.
Portsmouth, N.H.-based Aprisma makes software that helps pinpoint problems on an company's computer network. Marlboro, Mass.-based Concord's software monitors information technology networks and helps administrators troubleshoot errors.
"The big buzzword now is 'business service management,' and it's all about IT supporting business operations," said Concord CEO Jack Blaeser during a conference call Monday. "That's where the combination of the two companies is going to be very effective."
Gores, a Los Angeles buyout firm that specializes in technology plays, acquired Aprisma from Enterasys Networks Inc., an Andover, Mass., router maker, in 2002. Gores executives would not disclose terms of that deal, but sources speculated that it paid less than $10 million for Aprisma.
"We did the things that needed to be done in terms of strategically focusing and enhancing the business so it was ready to be bought by a strategic to complement the things they were doing," said Frank Stefanik, executive vice president of marketing and business development with Gores. "It was positioned so there was nothing they had to do to come in and fix things. It just seamlessly fit into Concord's long-term strategy."
Aprisma had revenue of $43 million in 2004 and has been profitable for the last eight quarters, said Dayton Semerjian, executive vice president of marketing and strategic alliances with Concord. He said the deal is expected to bolster Concord's earnings.
Richard Sherman, research analyst with Janney Montgomery Scott LLC, said the acquisition should help Concord cross-sell products and services to federal agencies and to cable operators, two of Aprisma's main markets.
"It's really complementary to Concord's core markets," Sherman said. "They bought an established brand name and an established business channel at a reasonable valuation."
John Horrigan, Bill Hsieh and Ed Rimland of Bear, Stearns & Co. advised Concord on the deal; Testa, Hurwitz & Thibeault LLP was counsel. Broadview International Ltd. advised Gores, which received counsel from Bingham McCutchen LLP.
On Dec. 15, 2004, Concord spent $4 million to acquire Vitel Software Inc., a Worcester, Mass.- based provider of voice network performance management software.
Technology M&A Practice was advisor to Gore Technologies Group.