Renewed rumors have BMC reaching for AirWatch in MDM play

Contact: Brenon Daly

The on-again, off-again rumors surrounding BMC and AirWatch are on again. Early word of the talks surfaced about a half-year ago, but we understand that a number of events may have interrupted discussions between the IT management giant and the mobile device management (MDM) startup.

For starters, BMC printed two transactions in January, including the purchase of Numara Software, a $300m acquisition that was the company’s largest deal in nearly four years. Additionally, Numara brought some rudimentary MDM capabilities from a tiny startup that it had acquired a couple of months before selling to BMC. Our understanding is that BMC is looking for more robust MDM technology than what it picked up with Numara, as well as its own purchase of tiny Aeroprise.

On the other side, valuations of MDM vendors have been skyrocketing. It was recently reported, for instance, that rival MobileIron raised its latest round at a valuation in the half-billion-dollar neighborhood. There was no word on what AirWatch would be going for.

However, any high-multiple acquisition could pose challenges – at least in terms of perception – for BMC, which has been under fire on Wall Street recently for its relatively paltry valuation. Last week, hedge fund Elliott Management bashed what it called ‘poor management execution’ at BMC, and renewed its call for a sale of the company. Elliott noted that BMC stock has underperformed both its rivals and the broader market recently.

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