(Bloomberg) -- BMC Software, a KKR & Co.-owned technology provider for businesses, is breaking up into two standalone companies.
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One of them will keep the name BMC and house a unit for big mainframe computers used by businesses, as well as software automation, according to a statement on Wednesday that confirmed an earlier Bloomberg News report.
The other will be called BMC Helix and focus on software tools that monitor and manage all the technology in an organization. BMC Helix will compete with the likes of ServiceNow Inc., while BMC’s competitors will include Broadcom Inc.
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, chief executive officer of BMC Software, said in an interview.
Sayed said that the split will accelerate growth rates for each of the companies. They aren’t bringing in a new investor and will continue to be owned by KKR and a minority shareholder, Len Blavatnik’s Access Industries. The companies still have to figure out their leadership and will start operating as independent entities next year.
BMC is the latest to join a $250 billion surge of corporate breakups that have helped drive the broader pickup in merger activity around the world. Sayed said the timing of the split is related to the wider economy emerging from a “slow-down period.”
“With interest rates coming down and the market responding positively and favorably to it, we collectively view 2025 as a year where not only we’re not in a recession, but hopefully we’ll get to see a wave of growth,” he said. “We want to make sure that we are positioned to participate and benefit from it.”
Last year, BMC confidentially filed for an initial public offering in which it could have been valued at up to $15 billion, Bloomberg News reported at the time. While the total raised in US IPOs this year is up 61% from this point in 2023, listings have slowed as the November election draws near, according to data compiled by Bloomberg.
When asked whether Houston-based BMC is still an IPO candidate or whether either part could attract M&A interest, Sayed said: “Whether it’s an IPO or private transaction, all options are available.”
BMC has expanded into new areas but it never abandoned mainframe computers, technology that first entered the marketplace in the 1960s and is still used by banks and other corporations, according to a Forrester Research Inc. report in March.
“Mainframes are far from dead. The technology continues to power enterprises around the globe, with some industries relying heavily on it,” Forrester analysts said.
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