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October 7, 1999

CA and CSC Bury the Hatchet With New Deal

By CBR Staff Writer

Proving that it’s possible to bury the hatchet even in the competitive IT world, arch enemies Computer Associates International Inc and Computer Sciences Corp yesterday issued a joint press release detailing what the two called a major expansion of their global software licensing agreement. Under the new agreement, CSC, which already uses CA’s software internally and as part of its services offerings to customers, said it would expand their 10-year relationship – signed in 1995 – to include the tools and technology that CA acquired through its Platinum acquisition. CSC says the addition of the products will enable it to extend its portfolio into strategic areas such as data warehousing/business intelligence, application life-cycle management, information security and e-commerce.

As a partnership announcement per se, this is nothing exciting. The interesting part is that it’s coming from CA and CSC together. After CA’s failed attempts to acquire CSC in 1998, the relationship between the two vendors became very bitter and acrimonious, with both sides accusing the other of malpractice and lawsuits popping up on an almost daily basis. One particular allegation accused CSC of not accepting CA’s offer on account of the fact the company was racist. As part of yesterday’s announcement, the two companies said they have agreed to end all legal actions still outstanding. And in an official statement, Van B Honeycutt, CSC chairman, president and CEO addressed the rascism allegation head on. CSC does not condone any remarks which may have been made by any individuals working on or reporting on the takeover attempt or our defense, that could be construed or misperceived as discriminatory in any manner, he said. We oppose any such thinking or behavior.

Speaking to ComputerWire yesterday, Marc Sokel, SVP and general manager of worldwide marketing welcomed the CEO’s words: Everyone is civil now, he said. There’s no question that what makes us feel good is CSC’s acknowledgement that issues of race shouldn’t enter into agreements. He added that while there were clearly still issues between members of CSC and CA’s top management, the deal marked the end of the wider dispute between the two companies. He said the deal reflects the fact that CSC realizes the value of CA’s products to its customers.

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