Is Compuware now safe?

Elliot Management has agreed to by Compuware competitor BMC. Earlier this year Elliot had tried to stage a takeover of Compuware.

Why would this have been important? Compuware would have most likely have been taken private and dis-assembled the same way that the three-headed-dog was trying to dis-assemble Chrysler just before bankruptcy. This would leave a big hole in Downtown Detroit's employment.

What do you think, is Compuware still a target? Do I need to watch my stocks closer than ever? I should be getting my first dividend since buying into this company in the post Y2K drop-off. Should I wait, or should I sell this for less than I purchased it? OR Does it take the pressure off the company? CPWR has not had much reaction today due to this on the board. I would have expected the numbers to go either way up or down.

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Originally Posted by DetroitPlanner

What do you think, is Compuware still a target? Do I need to watch my stocks closer than ever? I should be getting my first dividend since buying into this company in the post Y2K drop-off. Should I wait, or should I sell this for less than I purchased it? OR Does it take the pressure off the company? CPWR has not had much reaction today due to this on the board. I would have expected the numbers to go either way up or down.

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Probably people didn't expect the deal to happen, so there wasn't any reaction when it was clear it wouldn't.

Compuware is probably not safe from a takeover in the current environment--financing is cheap, so if a target company has reasonably stable earnings they can be taken over unless their market cap is pretty big. Compuware isn't that big. The question is whether it is attractive enough to be worth buying, and who knows. Obviously the people who didn't buy them didn't think so.

why not google the company's like i just did. BMC was bought by a group of private equity groups including Bain Capital [[remember Mitt Romney). their history is to rip companies apart and make huge amounts of money in fees and then let them go.
http://money.cnn.com/2013/05/06/tech...are/index.html
Compuware is safe now, but just stay diligent. Karmanos, who stepped down from board of directors says that the company should stay true to the commmunity, has no say any more.

compuware IS that big. they are right behind IBM.

IBM does alot of consumer based IT, Compuware does Corporate IT. that is why you don't hear alot about Compuware in the news unless you follow the geeky business news.

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Originally Posted by Chinman

compuware IS that big. they are right behind IBM.

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No they aren't. IBM has over 400,000 employees. Compuware has 4,000. IBM's annual revenues are 100x that of Compuware.
Compuware focuses on enterprise and mainframe software and services. IBM does hardware, networking, computer science and electronics research, semiconductors, and computer software ranging from firmware to operating systems to enterprise productivity and application software, along with services, hosting and co-locating.

They are entirely different, scale-wise.

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Originally Posted by Chinman

why not google the company's like i just did. BMC was bought by a group of private equity groups including Bain Capital [[remember Mitt Romney). their history is to rip companies apart and make huge amounts of money in fees and then let them go.
http://money.cnn.com/2013/05/06/tech...are/index.html
Compuware is safe now, but just stay diligent. Karmanos, who stepped down from board of directors says that the company should stay true to the commmunity, has no say any more.

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I think your perspective on private equity is, shall we say, a little bit off.

They take distressed companies, pump a substantial amount of capital and resources into them, and attempt to sell them, prepare them for IPO, etc. in an effort to provide an ROI to the fund managers. They don't charge "fees" because they own the company itself.

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Originally Posted by Chinman

compuware IS that big. they are right behind IBM.

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I don't know what metric you are using for "right behind IBM", but in this case the relevant metric is probably market cap. Compuware's market cap is 2.5 billion. IBM's market cap is 224 billion.

IBM is probably immune to a takeover, because no one is big enough--it would be by far the largest takeover ever. Compuware is bite-sized in comparison.

while i agree that IBM is by far and away much larger...Compuware is 2nd though yes smaller. but here are some stats:
Compuware has more than 7,100 customers around the world, including 46 of the top 50 Fortune 500 companies and 12 of the top 20 most visited U.S. websites.

I don't want to belabor this, but second behind IBM at what? For instance, in what area are they larger than Oracle?

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Originally Posted by mwilbert

IBM is probably immune to a takeover, because no one is big enough--it would be by far the largest takeover ever. Compuware is bite-sized in comparison.

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That's an understatement, lol. IBM's market cap is more than the Big Three combined [[GM, Ford and Toyota..).

when you deal in a consumer market like IBM and are over 100 years old, you will have a larger footprint. as i said in my 1st post, compuware is safe for now.
as for the private equity post, please tell me how many company's were saved when they bought them. i can show you so many more that were sold in parts with employees being disregarded in lieu of profits. and the do charge "fees". it is a way to reduce tax burden.

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Originally Posted by Chinman

when you deal in a consumer market like IBM and are over 100 years old, you will have a larger footprint. as i said in my 1st post, compuware is safe for now.
as for the private equity post, please tell me how many company's were saved when they bought them. i can show you so many more that were sold in parts with employees being disregarded in lieu of profits. and the do charge "fees". it is a way to reduce tax burden.

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Ah, that's why. Your perspective on saving companies differs from that of the market. Yours is "every job is safe". The market's is "the customers are safe".

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Originally Posted by michimoby

Ah, that's why. Your perspective on saving companies differs from that of the market. Yours is "every job is safe". The market's is "the customers are safe".

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A company's #1 mission can never be profits. Its mission can be to serve its customer as best it can while profiting. But the profits are a byproduct of serving the customer, not the other way around.

A municipality's mission cannot be to generate the most amount of tax revenue. It has to be offering the best services to its citizens. [[Notice, providing jobs is not the primary or secondary purpose to a municipality.)

If Compuware wants to be safe, which I hope it is, it becomes safe by being the best at its mission. Michimoby is right. When the customers are safe, the company is safe.


http://articles.latimes.com/2009/dec...ik31-2009dec31

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Drucker showed that there is no "inherent contradiction between profit and a company's need to make a social contribution," but that the former is indispensable to achieve the latter. He also warned that an enterprise that fails to "think through its impacts and its responsibilities" exposes itself to justified attack from social forces. Consumerism and environmentalism, he taught, are not enemies to be vanquished, but symptoms of business' failure to understand its broad social role.

"Peter was talking about this in the 1950s," or long before corporate social responsibility became a formalized management principle, says Rick Wartzman, a former Times colleague who is executive director of the Drucker Institute at Claremont Graduate University.
His views placed him in conflict with classical economists of the Milton Friedman stripe, who considered profit maximization the be-all and end-all of corporate behavior.
Profit may be the motivating force of the businessman, Drucker wrote, but it fails as "an explanation of his behavior or his guide to right action." Worse, this narrow view of the corporation's role inspires the hostility toward profit that is "among the most dangerous diseases of an industrial society."

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It appears that it is probably best just to hold for now. WWJ announced that Elliot Management's long term goal is to buy both BMC and Compuware and merge them. Not much I can do about it as I only hold a few hundred of millions of shares.

One possibility, Compuware does own its own office building. If a merger happens, it could be that most employees would be put in a place that makes the most financial sense. I would assume that a big chunk of Compuware is tied into having that building and being that it was built for a computer company it may mean moving Quicken out and BMC in.

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Originally Posted by DetroitPlanner

It appears that it is probably best just to hold for now. WWJ announced that Elliot Management's long term goal is to buy both BMC and Compuware and merge them. Not much I can do about it as I only hold a few hundred of millions of shares.

One possibility, Compuware does own its own office building. If a merger happens, it could be that most employees would be put in a place that makes the most financial sense. I would assume that a big chunk of Compuware is tied into having that building and being that it was built for a computer company it may mean moving Quicken out and BMC in.

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The bigger company always wins. I can't think of a good argument for why the hypothetically merged company would end up in Detroit.

From the media reports it seems like these two companies have very similar product lines. What they probably want to do most is combined the two companies client lists and then cull out the operational and product redundancies between the two companies.

I don't get the sense that most of Compuware's clients are in the Detroit area, either? I would think that would be the biggest factor for how much of a presence a combined company would maintain in Detroit.

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Originally Posted by iheartthed

I don't get the sense that most of Compuware's clients are in the Detroit area, either? I would think that would be the biggest factor for how much of a presence a combined company would maintain in Detroit.

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That's actually a two sided sword... the software clients are not predominantly located in metro Detroit... but the consultation services [[contract programming/IT staff) is located primarily in metro Detroit.

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Originally Posted by Gistok

That's actually a two sided sword... the software clients are not predominantly located in metro Detroit... but the consultation services [[contract programming/IT staff) is located primarily in metro Detroit.

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Compuware is all over the place. I recall we had a salesman in the Dallas area! :)

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Originally Posted by Chinman

compuware IS that big. they are right behind IBM.

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Simply not true. Compuware is a minnow, IBM is a whale.

Compuware is still a very significant company in Detroit. I've wondered if Gilbert would by the building from the vulture capitalists but I don't think they'd be willing to sell it for the right price to him.