Shares in Digital Communications Associates Inc have risen 24% to $20.50 in active trading since mid-December on the back of very woolly bid gossip, but the Alpharetta, Georgia company does have significant attractions, notably $138m in cash and no long-term debt, and the communications business in which it operates is regarded as one of the sexiest in the computer industry, and also one where substantial consolidation is regarded as likely and necessary: the downside from the company’s point of view is that despite its efforts to diversify – notably with acquisition of Microstuf Inc, developer of the widely-used Crosstalk communications program, the Irma family of micro-to-mainframe communications boards still accounts for 70% of its business, which is running at just over $200m a year; the firm was seen to be further destabilised last week by the resignation of president and chief operating officer James Ottinger to pursue other interests.
