PLATINUM technology

» see platinum.com as it lived, on the wayback machine

~ the obit ~

Computer Associates did not buy PLATINUM technology under its own name. It incorporated a subsidiary, called it HardMetal, Inc., and had HardMetal make the tender offer: $29.25 a share in cash for every share outstanding. The offer expired at midnight New York time on Thursday 27 May 1999. The following day HardMetal accepted about 108.6 million shares, roughly 98 percent of the company, and from that moment CA could name all but two members of the board. Platinum filed the whole thing itself, under the heading "Change in Control of Registrant."

The company sat at 1815 South Meyers Road in Oakbrook Terrace, a suburb west of Chicago, and sold tools for other people's databases: utilities and job scheduling for the kind of DB2 installation that sat on a raised floor. Andrew Filipowski started it in 1987. By the published company history he had founded DBMS Inc. in 1979, lost control of it when Shamrock Holdings took over in 1986, and had the next company going within a day of being removed from the old one.

What he built the second time ran on acquisitions. Revenue went from $304 million in 1994 to $968 million in 1998, which is real growth by any measure, and in every one of those five years it still posted a net loss from continuing operations. The worst was 1995, at $110 million of loss against $408 million of revenue. Even in 1998, when operating income finally came out positive at $20 million, the bottom line was red. Nothing was wrong with the products. The write-offs came from the buying.

By 15 March 1999 it employed about 5,830 people, of whom 1,980 were in product development and support. Ten weeks after that date, 98 percent of the company belonged to Computer Associates.

~ the rap sheet ~

~ the acquisition machine ~

The clearest description of Platinum's strategy is in Platinum's own annual report, filed six weeks before the end, and it appears under a risk factor rather than in the part of the document where a company boasts. "Since mid-1994, the Company has acquired 48 businesses and 31 technologies." The paragraph goes on to warn shareholders that future growth depends on continuing to do this, and that the integration of what it buys may not work. The engine was filed as a hazard.

The biggest of the late purchases was Logic Works in 1998, which brought in ERwin, a data modeling tool that had been shipping since 1993 and was by then embedded in the data warehouse pitch.

~ what the tender offer cost ~

Platinum's filing puts the total funds needed for the offer and the merger at approximately $3.5 billion. CA paid for it partly out of general corporate funds and partly from a new $4.5 billion credit facility signed on 26 May 1999, the day before the offer closed, with Credit Suisse First Boston as agent. That facility replaced a $2.6 billion one and carried a borrowing cost of around 6.5 percent at the time. Shares not tendered converted into the right to receive the same $29.25 in cash, and the deregistration form went in on 29 June.

~ the names that outlived it ~

Almost nothing from this company is called what it was called. AutoSys, the job scheduler, became Unicenter AutoSys Job Management under CA and sells today as AutoSys Workload Automation with Broadcom's name on the box. ERwin went to CA in the Platinum deal, sat there for seventeen years, got spun out to private equity in 2016 as erwin, Inc., and was bought by Quest Software in January 2021. It is still shipping. The company that owned it for twelve months in 1998 is the only link in that chain nobody mentions.

I was fifteen in 1999, with a modem and a monthly worry about the phone bill, and the enterprise software industry was as far from my screen as marine insurance. A name like this reaches you much later and from the side, as a line on a license list at work, or as a scheduler nobody wants to touch whose menus were drawn before you had an email address. You meet the products first and the company never. That is what being bought by Computer Associates did to a name.

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