Feb 14 Buyout firm Silver Lake is in exclusive
talks to sell information technology management company Serena
Software Inc to private equity firm HGGC LLC, four people
familiar with the matter said on Friday.
Silver Lake, which acquired Serena in 2006 for $1.2 billion,
is now negotiating a deal with HGGC that could value it at
between $450 million and $500 million, the people said,
cautioning that a final agreement had not yet been reached.
Under an exclusivity agreement signed this week, HGGC has 30
days to negotiate with Silver Lake and clinch a deal, one of the
The people spoke on condition of anonymity because the sale
process is confidential. Silver Lake and HGGC declined to
comment, and Serena Software representatives did not immediately
respond to a request for comment.
San Mateo, California-based Serena provides software to
companies seeking to streamline their management processes. Some
of its products compete with CA Inc, IBM Corp and
Serena has laid off staff and cut costs in the last two
years to address falling profits and boost operating margins as
its software license revenues continued to decline.
The company reported total revenue of $135 million for the
nine months ending Oct. 31, down from $153.6 million a year ago,
according to its latest financial statement. The company had
$410 million in debt and $94.4 million in cash, the statement
Silver Lake committed $335.5 million in equity in the $1.2
billion deal to take Serena private in 2006. It has not taken
any cash dividends from the company since, according to
Silver Lake currently owns about two-thirds of Serena, with
the remainder owned primarily by Douglas Troxel, who founded
Serena in 1980 and who was its chief executive officer until
1997. He still sits on Serena's board of directors.
Formerly known as Huntsman Gay Global Capital, Palo Alto,
California-based HGGC is a middle-market private equity firm
with $1.1 billion in committed capital under management,
according to its website.
Last year, HGGC sold commerce technology provider hybris
Software to SAP AG. Other HGGC software deals include
Sunquest Information Systems Inc and Innovative Interfaces Inc.