BMC acquires Magic Solutions

BMC Software Inc. announced on Monday that it has entered into an agreement with Network Associates Inc. to purchase the assets of its Magic Solutions division for approximately US$47 million in cash.

Magic Solutions provides help desk software and related solutions targeted at small- and medium-sized businesses (SMBs), according to BMC, which will add approximately 200 Magic Solutions employees to the BMC environment.

Upon completion of the acquisition, BMC will include the assets of the help desk software company — which include Magic Service Desk and Magic Help DeskIQ — to its Remedy business unit. The acquisition is estimated to be complete in the next 60 days, according to BMC.

Remedy is a division of BMC that provides service management software to automate and manage an organization’s internal and external service and support processes, the company said.

Jeff Hawn, senior vice-president of operations for BMC said in a statement that the acquisition of Magic Solutions is a financially attractive transaction that is consistent with the company’s approach to acquisitions.

Network Associates’ chairman and CEO George Samenuk said in a statement that selling Magic Solutions will benefit its customers and shareholders and that by completing the transaction the company will have a reinforced focus on network and system security solutions.

According to Kris Brittain, research director for Stanford, Conn.-based research firm Gartner Inc., Network Associates has spent the past three to four years debating whether or not it really wanted to remain in the help desk software market because this division “didn’t show up as a large percentage of the overall revenue generated by the company.”

“I think Network Associates had an ambivalent view of this product division. It was profitable, it was growing faster than the industry was but…I think they finally came to the conclusion that they wanted to divorce themselves from it so they could focus on their core competency,” Brittain explained.

Brittain added that by acquiring Magic Solutions, BMC has been given the opportunity to advance the acquisition of Remedy it made over a year ago.

“Remedy sells well into the mid-tier and enterprise space. [With] this complimentary product, there is limited overlap and customer base. From a business perspective, there is positive signs,” Brittain noted.