Elliott Management has made strides in its latest activist campaign against a technology company, as BMC Software retained investment bankers to explore a potential sale of itself, a person briefed on the matter told DealBook on Monday.
BMC has hired Bank of America Merrill Lynch to contemplate a number of possibilities, including selling part or all of itself, this person said. The company's current market value is about $6.8 billion, making a potential sale one of the biggest in the technology sector this year.
But the enterprise software maker may ultimately decide not to sell itself, this person cautioned.
Representatives for BMC and Elliott declined to comment.
The move by BMC follows months of agitation by Elliott, which has taken on a number of technology companies in recent years in an attempt to goad them into significant changes in strategy or management. Those efforts have largely been spearheaded by Jesse Cohen, a senior portfolio manage r at the hedge fund.
Two years ago, Elliott prodded Novell into exploring a deal, which ended in a $2.2 billion sale to Attachmate.
And last year, it began building up a stake in Brocade Communications - at its height, up to 8.5 percent - as it pushed for change. The hedge fund said in a regulatory filing that it supported the decision by Michael A. Klayko to step down as Brocade's chief executive when a successor is found.
Earlier this year, Elliott took aim at BMC, amassing a 7.7 percent stake and arguing that the company was badly lagging competitors and had missed business opportunities like software-as-a-service. Instead, the hedge fund argued in a public presentation, the software maker should consider a sale to any of a number of potential buyers, from bigger industry players like Oracle Inc. to private equity firms.
While BMC initially resisted, including by adopting a poison-pill plan, it eventually brokered a truce with the activist fund, pr incipally by giving Elliott gained two seats on its board.
Shares in BMC closed up more than 3 percent on Monday, at $42.85, after The Wall Street Journal reported news of the Bank of America hiring.
