Singapore’s GIC backs BMC Software take-private
Government of Singapore Investment Corporation (GIC) is participating in the $6.9 billion take-private of US enterprise software provider BMC Software, led by Bain Capital and Golden Gate Capital. It is the third-largest global PE deal announced so far this year, after Berkshire Hathaway and 3G Capital’s acquisition of Heinz and the Silver Lake-backed management buyout of Dell.
The investor group, which also includes Insight Venture Partners, has agreed to pay $46.25 per share in cash for all outstanding BMC common stock. It represents a 1.8% premium to BMC's closing price on Friday.
The deal is expected to close later this year, pending a 30-day go-shop period in which BMC can seek alternative bids, plus shareholder approval. Credit Suisse, RBC Capital Markets and Barclays have agreed to provide debt financing.
The agreement ends months of speculation about the company's future. Elliott Management, a significant shareholder that voted in favor of the PE offer, previously put pressure on BMC to come up with ways to boost the stock price.
"BMC believes the opportunity to become a private company will provide additional flexibility and position us to invest more strategically to drive powerful innovation and deliver cutting edge customer solutions," Bob Beauchamp, chairman and CEO of BMC, said in a statement. "We look forward to working closely with all parties to complete this transaction and enter into our next chapter of growth and industry leadership."
Houston-based BMC supplies software used by corporate customers to keep mainframe computer networks running smoothly. IBM is a major client. However, the emergence of software solutions delivered online and cloud-based services presents a strategic challenge for the company. BMC posted a net profit of $401 million for the year ended March 2013, with revenues reaching $2.17 billion.
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