Micro Focus acquisition is end of the line for Borland

When a company promotes its CFO to acting CEO, instead of advancing a sales or product executive, that’s a good sign that the company’s going to be sold soon.

That’s what I wrote on Jan. 8, in “Borland back in the frying pan,” after the news that CEO Todd Nielsen had jumped ship to join VMware. It took merely four months for that predication to come true.

The news today: Micro Focus, known for its COBOL tools, is buying Borland for about $75 million. That’s a dollar per share, a juicy premium over the company’s average-day closing price of 60 cents per share.

Ted Bahr, my partner at BZ Media, summed it up nicely in a tweet: “Don’t mourn the sale to Micro Focus. Borland has been dead for years, and the products you loved were bought by Embarcadero a few months ago.”

The Embarcadero connection is that Borland sold its tools subsidiary, CodeGear, to the database tool maker back in May 2008.

Micro Focus will be a good steward of Borland’s mish-mash of application lifecycle management, mainly cobbled together from acquisitions. It will be a better steward than Borland’s previous chief executives, Neilsen and former CFO Erik Prusch. The question is, of course, how much impact these products will have in the marketplace, even under new management. Borland had become a very minor player in ALM.

Also today, Micro Focus purchased some products from Compuware. To quote from Compuware’s press release, Compuware “has signed an agreement for Micro Focus to acquire assets from Compuware’s Quality Solutions product line, including development, sales and customer-support teams, as well as specific technologies. The $80 million transaction is expected to close this quarter and will impact about 330 employees.”

Bottom line: Borland is gone, and good riddance. Ted Bahr is right: few should mourn its passing. The differentiation is now clear: If you want ALM suites, go to Micro Focus. If you want application performance management tools, go to Compuware. And if you want developer tools, go to Embarcadero.