Orange County Business Journal

Quest Discloses Prior Bid

Chris Casacchia Friday, April 13, 2012

Aliso Viejo-based Quest Software Inc. rejected a bid that matched an offer valued at $2 billion last month from private-equity firm Insight Venture Partners in New York.

The other offer came from an unidentified financial firm on March 6, according to a recent regulatory filing by Quest. The bidder said it was willing to participate in a buy with Insight Venture.

Quest said it opted for the Insight Venture deal because it included a 60-day “go-shop” period to consider additional offers. The deal with Insight Ventures also includes a relatively small break-up fee of $4.2 million if it takes another offer during the go-shop period, or $6.3 million at a later date.

New York-based investment bank Morgan Stanley, which is advising Quest, reviewed the unidentified bidder as part of the process of assessing the Insight Venture deal, according to the filing.

The $2 billion price represents a premium of about 13% on Quest’s average 20-day share price prior to the announcement.

Quest declined to comment beyond the filing.