Active Directory Player To Join Quest

Quest Software, which makes management software tailored for Microsoft platforms, agreed to acquire smaller rival Aelita Software for $115 million in cash.

Should the purchase succeed, Quest would fortify its Microsoft management
portfolio. Aelita is considered a leading provider of systems management software that improves performance in Microsoft’s Active Directory and Exchange environments.

Exchange is Microsoft’s server software for its ubiquitous e-mail program. Active
Directory is a feature within Windows 2000 and 2003 servers that allows
companies to manage the programs and systems their employees use.

“Active Directory provides employee provisioning as a single authoritative
source about your users,” said Aelita spokesperson Carrie Reber.

The deal signals the ongoing consolidation in the enterprise
software sector as larger companies swallow smaller rivals in order to compete with major vendors such as Microsoft, IBM and Oracle. At the same time, management software continues to be a hot topic with enterprises that are looking to automate their software infrastructure.

Aelita specializes in migration and backup and
recovery for Microsoft environments, while Quest is noted for its prowess in
performance management, troubleshooting and Active Directory management. In an added twist, the deal could help Quest compete more effectively with Microsoft.

Reber said the deal would allow Quest to offer a more comprehensive suite of
management software. While Microsoft provides native support in its
operating systems and platforms, Reber said Quest and Aelita have been able
to successfully sell third-party management tools because customers often
find them easier, particularly if they’re performing high-volume migrations.

Quest Software CEO and Chairman Vinny Smith said the deal, which would bring
Quest’s customer roster from 18,000 to 21,000, is an attempt to give
customers more choice under one umbrella.

Executive teams from Quest and Aelita are currently working on a phased
integration plan to merge the two companies’ organizations. Until then,
Quest’s Microsoft infrastructure management products and Aelita’s software
will continue to be developed, marketed, supported and sold as complementary
products.

Aelita President and CEO Ratmir Timashev will lead the Quest Microsoft
product business.

Columbus, Ohio-based Aelita has about 400 employees and 3,000 customers,
which will be tucked into Quest. The acquisition is expected to be completed
by the end of the first quarter 2004.