Computer Associates

(CA) - Get Report

agreed to acquire

Concord Communications


for $330 million in cash, adding a popular suite of enterprise management software that is targeted to banks and other service providers.

The price is $17 a share. Concord, which was founded 19 years ago in Marlboro, Mass., closed Wednesday at $9.94, down about 10% on the year. Simultaneous with the buyout announcement Concord guided first-quarter earnings estimates lower, citing weakness in its health division.

Concord will be folded into Computer Associates' enterprise systems management business and its products will be integrated with CA's Unicenter enterprise management package. The acquisition is expected to close in three to four months and to add to CA's earnings starting in 2007.

The companies said the vast majority of Concord's 640 employees will remain with the company.

Regarding guidance, Concord expects to post a first-quarter loss of 3 cents to 7 cents a share, before charges, on sales of $28.5 million to $29.5 million. Analysts had been forecasting earnings of 1 cent a share on sales of $32.05 million. The company said 10 health industry deals worth $5.8 million failed to close during the quarter's final weeks.