UK firm splashes out to buy Borland and Compuware

One of the grandees of the IT industry for the past 30 years, Borland Software, has been acquired by British software company Micro Focus International, in a cash deal worth £50 million ($75 million).

At the same time, Micro Focus said it is also acquiring the application testing and automated software quality business of Compuware Corporation for £53 million ($80 million).

Micro Focus said the two deals would give it a leading market position in the testing and automation market.

Borland was founded way back in 1981 by three Danish citizens, but soon moved to the United States where it was headed up by the flamboyant Philippe Kahn, who led the company for most of the 1980s and 1990s.

Borland developed a series of well-regarded software development tools during its existence, and is probably most associated with Turbo Pascal, Quattro Pro (spreadsheet), and Paradox (database). The company was also known for acquiring Ashton-Tate back in September 1991, a deal that netted it the dBase and InterBase databases, and for a time Borland was counted as a serious rival to both Microsoft and Oracle.

But it soon found itself squeezed by its rivals and in 1998, Borland changed its name to Inprise Corporation in an effort to appeal to the enterprise applications development market. The idea was to integrate Borland's tools, Delphi, C++ Builder, and JBuilder with enterprise environment software. But the move backfired, and in January 2001, the Inprise name was abandoned and the company reverted to the "Borland" name once more.

In February 2006 Borland announced the divestiture of its IDE division, including Delphi, JBuilder, and InterBase. At the same time it announced the planned acquisition of Segue Software, a maker of software test and quality tools. The spinoff was called CodeGear.

From 2007, Borland concentrated on Application Lifecycle Management (ALM) and in May 2008 it sold its CodeGear division to Embarcadero Technologies.

The deal to acquire Borland means that Micro Focus will expand its presence in the application testing market, where it already operates with its Data Express product.

"Micro Focus's proposed acquisition of Borland represents the next logical stage in Micro Focus's growth journey," said Stephen Kelly, CEO of Micro Focus, in a statement. "Our organic performance remains strong as reflected in our trading statement also released today, and this transaction will add new scale and breadth to further develop our customer proposition, in an attractive adjacent market to our existing business."

Newbury, Berkshire-based Micro Focus was founded back in the 1970s and is best known as a software provider that helps companies move older legacy software to more modern business systems.

The UK company is also acquiring the application testing and automated software quality business of Compuware for $80 million, again also in cash. Compuware made its name in the testing, development and management software for programs running on mainframe computer and client-server systems.

Micro Focus feels its products are "highly complementary to Micro Focus' core solutions as they address a logically adjacent portion of the software development and deployment value chain."

"Acquiring the Compuware Testing and ASQ business is a logical extension to our existing application management proposition, and we see strong growth potential in this market," said Kelly.

Both deals have been approved by the relevant boards, but still need shareholder and regulator approval. Micro Focus also said its group revenues for 2009 were expected to grow year on year by approximately 20 percent.