Mercury Interactive

An Israeli-American software testing company

Mercury Interactive was founded in 1989 on the initiative of Aryeh Finegold, who had earlier founded Daisy Systems in the United States. Ilan Kinreich, who was the company's vice president of research and development, and Zvi Speiser are described in their biographies as co-founders. Amnon Landan, who had worked with Finegold at Daisy, joined the company in the year it was founded, and later became its CEO and chairman. The company operated in the United States and in Israel, and it had a large research and development center in Yehud. Finegold explained in an interview with Globes that registering as an American company was meant to help raise money from investors at a time when investing in Israel worried them. Mercury focused on software for organizations that develop and run information systems: testing, performance measurement and managing the use of technology. Its business customers used its tools to test the software and services they themselves provide.

What the products tested

Mercury's testing tools were designed to turn repeated testing tasks into a process that can be run and measured. LoadRunner, launched in 1993, focused on load and performance testing: generating activity by simulated users and checking how the system behaves as requests pile up. Alongside it, the company developed products for functional testing, including WinRunner (1993) and QuickTest Professional (2001), the test management tool TestDirector (1994), and products for application management. Its 2002 annual report described functional and performance testing as part of software quality assurance, together with monitoring applications after they go live. Functional tests check whether an action is carried out correctly, while load tests check how the system performs when many users access it at once.

IPO, growth and the options crisis

Mercury went public on Nasdaq on 29 October 1993, according to IVC data; the company's report recorded that the registration statement for the offering took effect that day. Its business expanded from software testing to application performance management and IT governance. In 2005 an options backdating affair came to light, and as a result CEO and chairman Amnon Landan and other senior executives resigned in November 2005. According to a Globes investigation into the sale, the crisis and the need to restate the financial reports influenced the decision to look for a buyer. The reporting crisis unfolded alongside the existing software business, and the company's new management ran the sale process.

Milestone: the HP acquisition

On 25 July 2006, HP's acquisition of Mercury was announced at $52 per share in cash, in a deal reported at about $4.5 billion. Globes and TheMarker described it as the largest cash deal in Israeli high tech up to that time; Lucent's acquisition of Chromatis in 2000, which Globes put at about $4.7 billion at the time, was larger, but was paid in shares. HP's annual report said that about 96% of the shares were acquired on 2 November, and the remaining shares on 6 November 2006, when Mercury became a wholly owned subsidiary. The announcement that the deal was completed was published on 7 November. HP reported a total accounting purchase price of about $4.9 billion, which also includes options and direct costs, compared with the deal amount published in the media.

Legacy

After the acquisition, Mercury's products were merged into HP's software organization, alongside its management products. Some of the software products later moved to Hewlett Packard Enterprise and to Micro Focus, which was acquired by OpenText in 2023. The continuity of the products can be seen today on OpenText's official page: LoadRunner Professional is called Professional Performance Engineering there, and the company describes it as the same tool with an updated name. It still simulates users, allows writing test scenarios and helps find bottlenecks. The performance testing product line continues to develop and to be sold, as part of OpenText's software portfolio. The founders also continued in technology: Ilan Kinreich founded RadView, which developed performance testing tools, and later served as chief operating officer (COO) of Radware. Zvi Speiser was one of the founders of Fibrolan, according to his official biography on the company's website. The lasting products and the companies its people founded are two ways in which Mercury's work continues beyond its sale.