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BMC Software In $900M Deal

BMC Software is buying Boole & Babbage in a stock swap deal worth $900 million, the companies said Monday.

BMC Software will issue 0.675 shares of BMC Software common stock for each share of Boole & Babbage common stock.

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BMC (BMCS) makes more than 200 software tools for corporate networked computers and San Jose, Calif.-based Boole & Babbage (BOOL), produces software for managing computer networks.
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BMC shares slipped 15/16 to 48 1/16 Friday ahead of the news; Boole & Babbage lost 1 to 26 5/8.

"The merger brings together these leading enterprise software visionaries to accelerate the delivery of solutions that significantly reduce the complexity of managing large enterprises through innovative products, an extensive worldwide distribution network and superior technical expertise," the companies said in a press release.

The transaction, expected to close within 60 to 90 days, is to be accounted for as a pooling of interests and is to be treated as a tax-free reorganization. It's subject to Boole & Babbage stockholder approval, regulatory approval and other customary closing conditions.

The deal is worth $900 million, based on BMC Software's closing price on Oct. 30.

Boole & Babbage rescinded its stock buyback program because of the deal.

"What makes this combination so exciting is the coherence of our shared vision, products and emphasis on customer support and satisfaction." Max Watson, chairman, president and CEO of BMC Software, said in a statement.

"I believe this union provides major benefits for our customers, employees and shareholders," said Paul Newton, president and CEO of Boole & Babbage. "The new company will gain critical mass and expanded channel reach that clearly establish us as a preeinent player in today's highly competitive and rapidly changing market."

The combined company will employ approximately 4,400 people in 26 countries that will significantly increase its global reach. In the last 12 months the combined companies' revenue was about $1.1 billion.

Written By Steve Gelsi

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