Current president and chief operating officer Sanjay Kumar will become president and CEO. He will refocus the company on three main businesses: security and storage management; network, event and performance management; and application development. Charles B. Wang, CA's founder and most recently chief executive officer, will continue as chairman. Wang will focus on building new opportunities, while Kumar takes care of day-to-day operations.
Kumar said the management change gives a better division of labor, and the restructuring is designed to "bring value to shareholders." Company officials also said CA (ca) is spinning things out because its technology and promising growth markets are lost amid the noise.
Company (ca) The stock has tumbled 52 percent since the company's release of dreary first-quarter earnings. Shares rose in pre-market trading Monday, as investors anticipated good news from the press conference at 8:30 EST. Shares were up at 26-1/8 on the Instinet electronic broker system from a Friday close of 24-3/4.
The first step in its strategy is the formation of iCan-ASP Inc., which offers technologies for providing applications through the Internet, wireless and broadband communications.
From now on, CA will report the iCan-ASP Inc. business separately. "It's a reasonable size and would be an impressive start-up," Kumar said of the division, which is profitable today.
The company did not give a firm time frame for the spin off; it has retained CS First Boston and Morgan Stanley Dean Witter to advise the company. It will determine the distribution of shares over the "next few months," said Wang. He added that the spin off won't distract CA from meeting estimates.
CA said it also plans to ultimately spin off its desktop accounting business ACCPAC, and other businesses over time.
Nancy Li, Chief Technology Officer of CA, will become iCan-ASP's CEO.