Real-time scrap for control of struggling giant

By ADAM GIFFORD

ORLANDO - For the leaders of a company facing a shareholder revolt, Computer Associates chairman Charles Wang and chief executive Sanjay Kumar looked remarkably composed as they faced the press here in Florida yesterday.

The company, whose products range from software used to manage huge mainframes to accounting packages for small business, has had a rocky year.

Its accounting practices have come under fire and it now has to contend with Texan billionaire Sam Wyly, former chairman of Sterling Software, which it bought last year, trying to rally shareholders to vote out the board at the annual meeting next month.

"We think [Mr Wyly's challenge] is a big waste of time, given what CA stands for," said Mr Wang at the start of CA World, an e-business conference and expo.

"We are fighting this battle and continue to fight."

CA's management already sit on 30 per cent of the vote: their own 10 per cent and the 20 per cent held by Swiss auto importer Walter Haefner, who has said he will vote against Mr Wyly's proposal.

Mr Wang points to the company's 25-year history and the 14,000 per cent increase in shareholder value over that time as why he expects shareholders will stick with present management.

Mr Wyly wants to break Computer Associates in four: one company for storage management products; another, security management; a third, systems management; and the last, knowledge management.

That plan, said Mr Kumar, was illogical. Much of CA's value lay in its ability to integrate technologies - a legacy of its history as an aggressive acquirer of other companies.

CA's fightback includes initiatives to raise its profile and change customer perceptions while increasing its range of licensing options - a change which has already clouded the financial results. Much of its business comes from sales to existing customers. To keep growing, CA must reach beyond that base.

Mr Wang spelled out the "3 by 6 strategy," a different way of looking at the company than Mr Wyly's.

CA has divided its products into three areas: e-business process management; information management; and infrastructure management.

Across the three strategic categories are six focus areas: enterprise management; security; storage; e-business transformation and integration; portal and knowledge management; and predictive analysis and visualisation. The key enterprise management technology is Unicenter, an industry standard.

Storage management comes under the umbrella of BrightStor, a line of products which will back up and protect data, whether it lives on a mobile device or a mainframe. CA's security products, including firewalls and anti-virus software, will be sold under the eTrust brand. Information management, including transformation and integration tools, portals, knowledge management and predictive analysis and visualisation now come under the Jasmine brand.

Asked whether CA would back the Java J2EE standards or Microsoft's DotNET initiative, Mr Wang said CA would stick by its policy of strict neutrality, developing for both platforms.

* Adam Gifford attended CA World as a guest of Computer Associates.