softwaredefinedtalk:

In this “bonus” episode, Brandon and I discuss Compuware going private (Thoma Bravo announced they were acquiring them) and the how private equity fits into the full life-cycle of a software company.

With Brandon Whichardand Coté.

Sponsor: get $200 off when you register for 451’s Hosting and Cloud Transformation Summit (Oct 6th to 8th) when you use the code MC200 at 451events.com. Also, you should sign up for my newsetter at coteindustries.com/memo.

Subscribe to this podcast: http://feeds.feedburner.com/SoftwareDefinedTalk

Show notes

“After more than a year of speculation and other reported offers, Compuware has agreed to sell itself to private equity (PE) firm Thoma Bravo for $10.92 per share, or $2.5bn. Thoma Bravo gets a valuable asset in mainframe and application performance management (APM) that has already unloaded most of its unwanted baggage. We expect the PE firm to build on its new portfolio company – its first move may be a merger with existing Thoma Bravo property Keynote Systems.”

  • A good return for the “activist investor” involved: “Jesse Cohn, the portfolio manager at [Elliott Management Corp. who owned ~9.5% of Compuware] involved with the Compuware investment, said the deal delivered a 30 percent return for his firm.”

  • Further: The Elliot Management folks are busy in tech: BMC, pressure EMC, Novell and has Attachmatte. Also LANdesk, Tripwire, Keynote, Embarcadeo (which has Borland, right?). Dell bought SonicWALL from them.

  • The Plan:

“We began with the I.P.O. of Covisint, initiated a robust dividend, divested noncore operations, and aggressively reduced corporate expenses,” Compuware’s chief executive, Bob Paul, said in a statement. “Compuware is now best suited to focus on its core mainframe and APM businesses as a private-equity backed company, where we can continue to serve our customers in a competitive environment with greater flexibility to take a long-term approach.”

Compuware revenue

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