Cleanup Firm Sets Sights on Computer Associates

Relational Investors, a money management firm with a reputation for forcing directors of ailing companies to shape up, has quietly amassed nearly 5.5 million shares in Computer Associates(CA Quote).

With its $140.7 million investment, the San Diego, Calif., firm purchased just under 1% of the software giant's outstanding shares, making Relational the 16th largest institutional holder of the stock, according to regulatory documents filed at the end of June.

Relational's managers, Ralph Whitworth and David Batchelder, are more than just good governance types. Over the eight years of its existence, the privately held firm has earned an average return of 21%, nearly triple that of the S&P 500's 8.63% return during the same period. ...