LANDesk Software, a provider of IT systems, security and service management software, has been acquired by private equity firm Thoma Bravo, a move it says will provide it with resources and focus to better grow its business. Emerson, a technology giant with $21 billion in fiscal 2009 sales, acquired LANDesk last year as part of its purchase of Avocent, but soon realized the company wasn't a strategic fit.
Steve Daly, executive vice president and general manager of LANDesk will become CEO of the newly spun-off company. "Thoma Bravo is the perfect landing place for LANDesk," says Daly. "[It is] experienced in doing software carveouts. They have a philosophy they call 'buy and build.'" LANDesk is one of 50 software acquisitions by Thoma Bravo and will be one of 16 software platforms, or product areas, on which the acquired companies focus. Thoma Bravo's holdings have generated total annual earnings in excess of $700 million. Emerson focuses on data center build-out and operations, while LANDesk targets end-point management at the desktop and mobile device level, says LANDesk spokesman Robert Naegle. He adds that other parts of Avocent focused on data center business will stay with Emerson.
LANDesk's history has been marked by acquisitions and spinoffs. The company began as a unit within Intel in the early 1990s. It was spun off in 2002 and funded by venture capital. Avocent acquired LANDesk in 2006, and Avocent was itself acquired by Emerson last year. Early this year, Emerson announced plans to sell LANDesk and regarded it as a "discontinued operation," meaning LANDesk's results don't count in Emerson's earnings-per-share and that Emerson was not allocating any resources to LANDesk. The LANDesk spinoff is the second for Emerson in as many weeks. On Aug. 17, the firm announced it was selling its Motors and Appliance Controls businesses to Nidec Corporation of Japan.
IT administrators face growing demands for system, security and service management of endpoint devices, Daly says. It's no longer an issue of just managing Windows or Linux systems on desktops or laptops, but managing the plethora of mobile devices running Apple, Android or other OSs. He notes there are an estimated 500 million PCs or laptops in corporate environments today, and industry estimates of as many as 50 billion IP-connected devices to manage by 2020.
Some LANDesk customers applauded the news. "They continue to be a key partner in anticipating and addressing the most pressing issues to ease the management of complex IT systems," says Peter Schrady, vice president and general manager of laptop maker Lenovo's software and peripherals division, in a prepared statement. LANDesk, with about 750 employees, will continue to operate in its corporate headquarters in Salt Lake City.