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Insight Said to Top $25.50-a-Share Buyout Offer for Quest

A Quest Software Inc. office in Ottawa, Ontario, Canada. Quest, a maker of tools to help companies manage computer systems, said last week that it got a bid that exceeded a March offer of $23 a share, or about $2 billion, from Insight, a private equity and venture capital firm. Photographer: Brent Lewin/Bloomberg
A Quest Software Inc. office in Ottawa, Ontario, Canada. Quest, a maker of tools to help companies manage computer systems, said last week that it got a bid that exceeded a March offer of $23 a share, or about $2 billion, from Insight, a private equity and venture capital firm. Photographer: Brent Lewin/Bloomberg

June 19 (Bloomberg) -- Insight Venture Partners topped a $25.50-a-share bid that Quest Software Inc. received from Dell Inc., intensifying a takeover battle for the software maker, according to two people familiar with matter.

Insight sweetened its March 9 offer of $23 a share for Quest, after the software maker said last week it got a higher offer from a strategic bidder, said the people, who declined to be identified because the process isn’t public. Dell was the unnamed bidder, one of the people said.

Quest Chief Executive Officer Vincent Smith prefers a sale to Insight over Dell because it would allow him to keep running the company, the person said. Smith owns about one-third of Quest and could retain at least some of that stake in a transaction with Insight, meaning the firm may not need to finance a full takeover, the person said.

Quest has advanced 43 percent this year to $26.52, giving it a $2.24 billion market value, after the competing bids emerged for the Aliso Viejo, California-based company. Quest’s software helps businesses administer databases and servers, as well as back up information and recover lost data. New York-based Insight specializes in software and Internet businesses.

David Frink, a spokesman for Dell, declined to comment. A representative for Insight didn’t respond to a request for comment.

Dell’s Deals

Dell, the world’s third-largest PC maker, told analysts at a June 13 meeting it plans to use deals to boost revenue from data-center hardware, software and services by 45 percent to $27.5 billion by fiscal 2016, reducing the company’s reliance on the slow-growing desktop and notebook computer business.

The last time Dell engaged in a public takeover fight was in 2010, when it lost storage company 3Par Inc. to Hewlett-Packard Co., which bought it for $2.35 billion, after the 18-day bidding war tripled the company’s market value.

Michael Dell, founder of the Round Rock, Texas-based computer company, told Bloomberg News last year that HP overpaid for 3Par, and he made the right decision in dropping out of the process.

To contact the reporter on this story: Serena Saitto in New York at ssaitto@bloomberg.net

To contact the editors responsible for this story: Tom Giles at tgiles5@bloomberg.net; Jeffrey McCracken at jmccracken3@bloomberg.net

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