(Bloomberg) — BMC Software, a technology provider for KKR & Co. companies, is being split into two standalone companies.
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One of them will keep the BMC name and house a unit for large mainframe computers used by businesses as well as software automation, according to a statement Wednesday that confirmed an earlier Bloomberg News report.
The other will be called BMC Helix and will focus on software tools that monitor and manage all technology in an organization. BMC Helix will compete with the likes of ServiceNow Inc., while BMC’s competitors include Broadcom Inc. will be.
About two-thirds of the current company’s $2.3 billion in revenue will be picked up by the new BMC business, with the rest going to BMC Helix, Ayman Sayed, CEO of BMC Software, said in an interview.
Sayed said the split will accelerate the growth of each of the companies. They are not bringing in a new investor and will remain owned by KKR and a minority shareholder, Len Blavatnik’s Access Industries. The companies have yet to discover their leadership and will start operating as independent entities next year.
BMC is the latest company to join a $250 billion wave of corporate splits that have contributed to the broader uptick in merger activity around the world. Sayed said the timing of the split is related to the broader economy emerging from a “slowdown period.”
“With interest rates falling and the market reacting positively and favorably, we collectively view 2025 as a year where not only will we not be in a recession, but we will hopefully see a wave of growth,” he said. . “We want to make sure we’re in a position to participate and benefit from it.”
Last year, BMC confidentially filed for an initial public offering that could have valued it at up to $15 billion, Bloomberg News reported at the time. While total U.S. IPOs are up 61% this year from this point in 2023, listings have slowed as the November election approaches, according to data compiled by Bloomberg.
Asked whether Houston-based BMC is still an IPO candidate or whether either unit could attract M&A interest, Sayed said: “Whether it is an IPO or a private transaction, all options are available. “
BMC has expanded into new areas but never abandoned mainframe computers, a technology that first came to market in the 1960s and is still used by banks and other companies, according to a Forrester Research Inc. report. from March.
“Mainframes are far from dead. The technology continues to power businesses around the world, with some industries heavily dependent on it,” Forrester analysts said.
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