There is no surer signs that the IT industry is now ‘mature’ (even ‘boring’?) than when it pays dividends, creates huge cash piles that it doesn’t know what to do with and becomes the target of private equity.
Latest such example is BMC which was subject to a $6.9b deal with Bain Capital and Golden Gate Capital, over the weekend. It’s not a done deal as there is a 45 day ‘Go shop’ period. As we know, the Dell‘Go shop’ period brought about another two rival bids. So we might expect similar in BMC’s case.
BMC is all about mainframe software. In the UK MicroFocus shareholders have done really well of late as the company returns as much cash as possible to shareholders from its old but cash positive mainframe software business. There is continued speculation about CA and Compuware, both also involved in mainframe software.