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Senior Editor

IBM becomes new Candle holder

Apr 05, 20042 mins
Data CenterIBMMergers and Acquisitions

IBM, in an effort to expand its management software arsenal, last week snapped up longtime partner and sometime competitor Candle for an undisclosed sum.

Candle, a privately held company formed in 1976, is best known for its mainframe system management and analysis tools, although it also offers software for managing distributed applications, systems and middleware programs, such as those in IBM’s DB2, WebSphere and MQ portfolios.

Robert LeBlanc, general manager for Tivoli Software at IBM, says Candle’s software will fill gaps in IBM’s product line, such as in performance and availability management on high-end zSeries machines. Candle technologies are expected to be integrated across IBM’s software divisions: DB2, Lotus, Rational, Tivoli and WebSphere.

LeBlanc did not say if any overlapping Candle and Tivoli products would be discontinued once the merger is final, which is expected to happen by midyear.

Andy Mullins, president and COO, says Candle either had to embark on a huge growth plan or get acquired to thrive in what’s become an increasingly competitive market among data center product suppliers.

Candle found success in the early 1980s with its Omegamon suite of mainframe management software products. In 2002, the company introduced PathWAI, software and consulting packages aimed at helping customers design, test, deploy and manage Web server and middleware infrastructures.

The acquisition isn’t surprising in light of the fact that there’s still good money to be made in mainframe management, says Jasmine Noel, a principal at Ptak, Noel & Associates.

“Competition is becoming extremely fierce, and the goal is to grab as much market share as possible. Since the cost of switching customers is incredibly high, it’s easier to buy the competition,” she says.

Other potential acquisition targets in the management software market include companies such as ASG, Compuware and Heroix, while vendors such as BMC Software and Computer Associates are possible buyers, Noel says.