Compuware’s CEO Robert Paul declined to comment this week on any specific reports or speculation, but said the board remains open to considering potential bids.
This fall’s initial public offering of Covisint, a Compuware subsidiary in the cloud-computing business, made it easier for someone to buy Compuware.
Compuware spun off 20% of Covisint in the IPO and plans to distribute the rest in shares to Compuware shareholders sometime next year.
In a recent interview with Computer Business Review, Paul said private equity firms had “a little bit of a hard time” coming up with a high enough offer to buy Compuware because Covisint, which has a nearly $500-million valuation and is considered a high-growth company, has yet to generate earnings to help such buyers pay off the debt they would need to buy Compuware whole.
With Covisint spun off, a prospective suitor could now buy Compuware for about $2 less per share.
“I don’t know who or when or what, but I believe somebody will eventually buy them,” said Jim Yin, an analyst with Standard & Poor’s in New York.
Compuware’s management and board could also now bargain from a stronger position than a year ago, as the company has already made many of the difficult changes that a hedge fund or private equity-type buyer would want to do.
Nevertheless, another Compuware shareholder and New York-based activist hedge fund, Starboard Value, caused a stir last month with a public letter to Compuware’s board that urged it to either hurry and sell the company or ratchet up the cost-cuts to $150 million, sell off business units and do a leaseback of its glassy headquarters around Campus Martius.