A group of private equity firms led by Bain Capital and Golden Gate Capital is near a deal to buy BMC Software, people briefed on the matter said on Sunday, nearly a year after an activist hedge fund sought to push the technology company onto the auction block.
The group is expected to pay less than $50 a share, one of these people said. A deal could be announced as soon as Monday, though these people said that final details were still being negotiated and talks could still fall apart.
Shares in BMC closed on Friday at $45.42 each, valuing the corporate software maker at over $6.5 billion.
Representatives for BMC, Bain and Golden Gate declined to comment or weren’t immediately available for comment.
If completed, a deal would mark the resurgence of the private equity industry. The continued availability of cheap debt and bulging war chests of investor capital has underpinned ever-bigger deals, including Silver Lake and Michael S. Dell‘s $24.4 billion bid to take Dell Inc. private.
A successful transaction would also represent the culmination of a lengthy campaign by Elliott Management to nudge BMC into a sale. The hedge fund first emerged as a major shareholder last spring, calling for the enterprise software maker to take drastic action after trailing competitors.
Elliott held a 9.4 percent stake in BMC as of Dec. 31.
In October, BMC hired investment bankers to run a sales process, drawing interest from a number of private equity firms. By late last week, the group led by Bain and Golden Gate emerged as the front-runners to buy the company.
The two firms have substantial experience with technology deals: Bain has invested in the likes of Sungard and Doubleclick through its private equity and venture capital arms, while Golden Gate counts a number of software companies in its portfolio.
The BMC auction marked the latest victory by Elliott, which has made a high-profile run of agitating for change at technology companies through activist campaigns. The hedge fund made an unusual bid for Novell over two years ago, culminating in the software company’s $2.2 billion sale to the Attachmate Corporation and Elliott.
The investment firm has also targeted the likes of Brocade Communications and Compuware.
