Computer Associates Buys CMSI

Shares of Computer Management Sciences Inc. surged 18 percent Monday morning after Computer Associates International Inc. said it's buying the information technology consulting firm for $28 a share, or $435 million, in cash.

The offer, made through a subsidiary of Computer Associates (CA), the fourth-biggest U.S. software firm, is a 19 percent premium over CMSI's (CMSX) closing price of 23 1/2 on Friday

Shares of CMSI, a maker of business software, rose 4 1/8 to 27 5/8. Computer Associates shares edged up 1 11/16 to 48.

Computer Management, headquartered in Jacksonville, Fla., will become part of Islandia, N.Y.-based Computer Associates' global professional services unit, which supplies major corporations with business software programs, the company said.

"Our partnership with CMSI extends our continuing strategy of building GPS through highly-focused acquisitions that complement Computer Associates' core competencies," said Sanjay Kumar, Computer Associates' chief operating officer, in a statement.

The deal is the fourth in a series of acquisitions Computer Associates has made to bulk up its GPS business. The previous acquisitions were Realogic Inc., LDA Systems Inc. and Aventura Systems ASA.

Written By Lisa J Ulmer, CBS MarketWatch