Business journalist JC Reindl checks the pulse at Compuware as the Free Press looks back at a tumultuous 2013 for the prominent downtown employer.
Nearly a year has passed since the December morning when leaders of Michigan’s largest computer technology firm awakened to a takeover bid from an aggressive New York hedge fund.
A lot has changed in those 12 months at Detroit-based Compuware — including a shake-up of the board, employee layoffs and severed ties and bitter public feuds with its co-founder, Peter Karmanos Jr.
Yet the company’s future remains very much uncertain. Despite numerous changes made to please shareholders and activist investors, there is still the possibility that Compuware could soon be snapped up by an out-of-state hedge fund or private equity firm.
The company moved to Campus Martius from Farmington Hills, contributing to a downtown revival. (Compuware photo)
In his detailed analysis, Reindl sketches this bleakest-case outcome for the software and computer services provider, as well as its home base:
If Compuware is sold, more jobs could be cut, management could be replaced and its Detroit headquarters — which spurred downtown’s revitalization — could be eliminated or shrunk.
“If that means breaking it up, throwing the pieces into the wind and eliminating a company in Detroit, they don’t mind that,” Karmanos warned earlier this year in an interview. . . .
There are signs of success, as mainframe business accounted for 35% of the firm’s revenue last fiscal year compared with 51% in 2010, according to corporate filings.
But Compuware’s new growth businesses do not have as high a profit margin as its older mainframe business.
Related coverage at Deadline Detroit:
Compuware Founder Peter Karmanos Files Lawsuit Against His Old Firm Over Stock, Nov. 18
Compuware Ventures, a company division, provided start-up funding for Deadline Detroit.
