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CA Technologies to pay $614M for Burlington cybersecurity firm

Note: this is a reprint of March 6, 2017, Bizjournal article. The original article can be found here.     

Burlington security software company Veracode will be acquired by CA Technologies for $614 million in cash, the companies announced Monday. 

The acquisition is expected to close in the next several months.

New York-based CA Technologies (Nasdaq: CA) generated just over $4 billion in revenue in fiscal 2016 and said it expects the Veracode acquisition to increase reported revenue between 1 and 3 percent in its next fiscal year, assuming the deal closes sometime in April of this year.

Veracode is one of the largest cybersecurity firms in Massachusetts, with 375 employees in the state as of April 2016. In late 2014 and early 2015, reports indicated Veracode was considering an initial public offering that would have valued the firm between $600 million and $800 million.

Founded in 2006, Veracode makes cloud-based software that allows developers to test and monitor the security of their applications during the building and deployment process. The company has more than 1,400 customers, including Boeing and Thomson Reuters.

Veracode has raised at least $134 million lifetime. A $40 million round in September 2014 was led by Boston-based investment management firm Wellington Management Company with participation from existing investors, which in the past had included .406 Ventures, Atlas Venture, StarVest Partners and Meritech Capital Partners.

CA Technologies, which provides enterprise clients with an array of software products, says Veracode will help it appeal to midsize enterprises.

"Software is at the heart of every company's digital transformation. Therefore, it's increasingly important for them to integrate security at the start of their development processes, so they can respond to market opportunities in a secure manner," said CA Technologies President Ayman Sayed in a statement. "This acquisition will unify CA's Security and DevOps portfolios with a SaaS-based platform that seamlessly integrates security into the software development process."

The announced acquisition is the largest tech deal in the state since January, when Hewlett Packard Enterprise announced it would buy data storage company SimpliVity for $650 million.

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