CA: Ghosts of deals past

When CA Inc opens the doors for its annual meeting today, we expect there will be more than a few ghosts floating around the hallways at the company’s Long Island headquarters. CA, which has been under one form of investigation or another for much of this decade, can’t seem to leave the past behind. Just last week, in a sort of Shakespearian development, the former chief executive, currently in jail, lobbed the charge that the company’s board and other executives knew all about the book-cooking. Sanjay Kumar may have initially taken the fall for the company’s ’35-day months,’ among other shady accounting practices. But now he’s looking to drag others down.

We mention the latest courtroom contretemps because we have the sense that it has taken CA out of the M&A market. CA, which typically buys a handful of companies each year, hasn’t inked a deal since July 2006. (One of those acquisitions, in the late 1980s, actually brought Kumar to CA.) While we have heard rumors that CA may be on the verge of ending the two-year drought, nothing has been closed. (One set of rumors had CA looking at acquiring a systems management vendor.) Further, a few conversations with bankers indicate that not many of them are bothering with a trip out to Long Island to pitch possible deals. That’s understandable, since the company’s lawyers are probably too busy with other matters to look at a deal book.

CA deal flow

Year Deal volume
YTD 2008 0
2007 0
2006 6
2005 6
2004 3
2003 4

Source: The 451 M&A KnowledgeBase

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