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-Aaron Burr

September 02,2014

Compuware to Be Acquired by Thoma Bravo

martinwolf Transaction Analysis

Financial Information

  • Transaction Size: $2.5 Billion
  • EV/Revenue (Approximate): 2.4x

Transaction Facts

  • Compuware Corp. (NASDAQ:CPWR), a technology performance software provider, announced today that it would be taken private by Thoma Bravo LLC, a leading private equity firm for an aggregate value of $10.92 per share, or approximately $2.5 billion.
  • The deal, which has been unanimously approved by the Compuware board, reflects a premium of approximately 17 percent to Compuware’s stock price at the close of trading on Friday, Aug. 29, 2014. On news of the transaction, Compuware shares were up 13% in Tuesday trading.
  • While the aggregate value of the transaction is approximately $10.92 per share, because of offsets for Covisint (NASDAQ:COVS), Thoma Bravo is paying a cash purchase price of $10.43 per existing share of Compuware common stock.
  • Compuware joins several software companies at Thoma Bravo, including Attachmate, Blue Coat Systems, Deltek, Empirix, Flexera, Keynote Systems and Landesk Software.
Going Private to Accelerate Transformation
  • Culminating a Long Process: This deal marks the end of a process beginning in 2012 when activist hedge fund Elliott Management bought what is now a 9.5% share in Compuware. Since then, Compuware has replaced several board members, spun off Covisint, began regular dividends and implemented other changes to create value for shareholders in a process many observers saw as preparing Compuware for an eventual sale.
  • A History of Activist Investment: In a similar transaction one year ago, Elliott Management took a 9.6% stake in BMC Software and implemented changes at the board level before BMC was sold to a coalition of buyers led by Bain Capital and Golden Gate Capital.
  • The Opportunity of Going Private: For many IT companies, including Dell and CompuCom, going private (multiple times, in CompuCom’s case) has been key to being able to successfully transform without the constant scrutiny and oversight facing public companies. We expect Compuware to continue to take steps to build value at a faster pace now with the support of Thoma Bravo.

For more information, view the press release by clicking here. martinwolf was not the advisor in this transaction.

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