Computer Associates to Stop Buying Companies – Start Spinning Them Off

from the seems-like-the-reverse-of-a-good-plan dept

Now this seems like a very strange plan. Computer Associates announced today that they’re going to stop buying new companies and instead start spinning off a company a quarter. Now, I’m no financial genius, but it seems to me that this is the exact opposite of what they should do (and what most other companies are doing). There have been a lot of spinoffs in the last five years because the market was doing well. Now, with the downturn, there’s been a lot of buying, because companies were cheap. So, basically, what CA is saying is that they bought a lot when the price was high, and now that the price is low, they’re only selling. Doesn’t seem like the smartest strategy to me.

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