Under the deal terms, the buyers’ group, which includes the Government of Singapore Investment Corporation and InsightVenture Partners, will pay $46.25 a share in cash.
That represents a 14 percent premium to BMC’s share price on May 11, 2012, the last business day before the company disclosed that Elliott Management had taken a big stake – now up to about 9.6 percent – and was urging a sale.After initially resisting Elliott, the two sides reached a compromise, with Elliott gaining two board seats and BMC beginning to explore a sale last fall.
A number of buyout firms emerged during the auction process overrecent months, though by last week the Bain and Golden Gate consortium took the lead.
“After a thorough review of strategic alternatives, the BMC board of directors is pleased to reach this agreement, which provides shareholders with immediate and substantial cash value, aswell as a premium to our unaffected share price,” Robert E. Beauchamp, BMC’s chairman and chief executive, said in a statement.
Jesse Cohn, the Elliott portfolio manager who led the firm’s campaign,added: “Elliott applaudsthe BMC Software boardand executive leadership for delivering this value-maximizing outcome for stockholders, which both contains a go-shopprovision and reflects what we believe is a substantial premium to BMC’s unaffected stock price.”
As part of the deal, BMCwill have 30 days to try to find higher bids.
Credit Suisse , the Royal Bank of Canada and Barclays will provide debt financing.
BMC was advised by Morgan Stanley , Bank ofAmerica Merrill Lynch and the law firm Wachtell, Lipton, Rosen& Katz. The investors received financial advice from Qatalyst Partners, the boutique bank run by Frank P. Quattrone ; Credit Suisse;RBC Capital Markets; and Barclays.
The investor group was counseled by Kirkland& Ellis and PricewaterhouseCoopers.
