Altiris Buys Pedestal Software for $65 Million
by Timothy Prickett Morgan
Systems and application management software vendor Altiris has acquired Pedestal Software for $65 million in cash. By doing so, Altiris can now offer security management software on top of the substantial portfolio of systems management tools it offers directly and resells through Hewlett-Packard, Dell, and others.
Only a few weeks ago, Altiris said it would be looking to make acquisitions to position itself as a more complete player in the enterprise space. Lindon, Utah-based Altiris is one of the many companies founded by The Canopy Group, the venture capital company created in late 1994 by Novell founder Ray Noorda. The addition of Pedestal Software comes on the heels of Altiris buying Tonic Software Inc in January, Bridgewater Technologies Inc in September 2004, and Wise Solutions Inc in December 2003. While many of Altiris' rivals have been snapped up by BMC Software (which bought Marimba), Symantec (which bought On Technology), and HP (which bought Novadigm), Altiris has a market capitalization of around $670 million and would probably fetch more than $1 billion if someone tried to buy it. (Uh, HP. Now might be a good time, especially before Dell or IBM buys it.)
Altiris expects to close the acquisition by the end of March and will start integrating the Pedestal Software security products into its own line. Altiris said that the Pedestal security products would bring in between $17 million and $18 million in fiscal 2005 and would start adding to profits by the third fiscal quarter; the company added that the line would be profitable for the entire fiscal 2005 year, which suggests that Pedestal was on its way to hitting the mainstream. This would be why Altiris would pay more than 3.5 times sales to acquire the Pedestal. Altiris had $166.5 million in sales in 2004 and a net income of $16.7 million.