Computer Associates (CA), the world's third largest software company, is planning to increase its workforce in the Republic from 40 to around 400 "as soon as possible". It is in the final stages of planning an operation centre in the mid-west with IDA Ireland.
According to Mr Noel Meaney, general manager of CA Ireland, the company will acquire an information technology services company probably in the Limerick or Sligo areas. "We are looking at a number of companies that would take us well on our way to achieving our recruitment target, and the mid-west offers access to a huge pool of people from Limerick and Galway," Mr Meaney told The Irish Times during CA's annual conference in New Orleans this week.
CA is likely to recruit an additional 50 employees initially, and pursue a policy of continuous recruitment, with a view to making the Republic CA's outsourced IT management centre for Britain "if not Europe".
The new centre will focus primarily on IT services for companies who want their IT systems managed externally.
CA Ireland is forecasting a turnover of around £50 million (€63.49 million) over the next 18 months. The company had a global turnover of $5.1 billion last year, and this week reported first-quarter profits of $249 million, or 49 cents a share, on sales of $1.22 billion. This was well ahead of Wall Street estimates of 39 cents a share.
The move to acquire an Irish-managed services business fits in with CA's decision to concentrate more on IT services.
At present it generates two-thirds of its revenue from software sales, with the remainder coming from services.
Speaking in New Orleans this week, Mr Charles Wang, CA chairman and chief executive officer, said the company would now focus on reversing this model to make services account for two-thirds of CA's entire business.
Much of CA's Irish operation focuses on IT services, particularly for government departments and financial institutions.
It is involved in a major pilot project with the Revenue Commissioners to automate and integrate the process of filing tax returns.
The first phase of the project will allow 6,000 companies to conduct all their PAYE, corporation and VAT activities online. The service will be made available to the public within 18 months.
According to Mr Meaney this is the first global example of a national tax collection process going online. A number of foreign government officials have visited Dublin to view the Irish programme, and Britain's Inland Revenue has expressed interest in adopting the system. Last year, the Revenue Commissioners won CA's annual international award for "best Users of CA technology".
CA is also providing the software for Bank of Ireland's new offshore banking project which will be located in the Isle of Man. The IT systems will be managed remotely in the Republic by CA personnel.
The bank, to be known as Fsharp, will target expatriates who are seeking a high-tech 24-hour banking service. Bank of Ireland has said the service which is expected to be operational by September, is the first example of a "fully interactive, transactional, offshore, Internet bank".
CA has pursued a strategy of aggressive acquisition over the past five years, and because of its focus on supporting multiple technology platforms it is well positioned to capitalise on the shift by businesses from mainframe to fully-integrated network environments.
According to Mr Liam Carabini, CA managing director for Britain and Ireland, the company is planning a major marketing initiative over the next couple of months. He said the company has had problems getting its message out to customers, despite having the software it needs. This has been the primary motivation behind the shift in focus to services, and the decision to acquire Platinum Technology for $646 million. It brings strong data warehousing and security software to the CA portfolio.
"In this time of mergers and acquisitions, only the strong survive. There will only be two players in the electronic world ahead - CA and IBM," Mr Carabini said.
