The demand for on-demand business software continues to make waves.
Cornerstone OnDemand Inc. has received approaches from potential buyers as shareholders including Praesidium Investment Management push the company to run a formal process, people with knowledge of the matter said.
Cornerstone, based in Santa Monica, Calif., hasn’t yet hired a bank to actively pursue a sale, said the people, who asked not to be identified because the information is private. Still, it’s having conversations with potential buyers, the people said. Cornerstone sells cloud-based software, delivered in a software-as-a-service model, or SaaS, to manufacturers, healthcare organizations, retailers, government agencies, schools and other organizations to help them recruit and manage their work forces.
The company has become an attractive target after some of its peers were acquired earlier this year, including Demandware Inc., purchased by Salesforce.com Inc., and LinkedIn Corp., which was bought by Microsoft Corp., according to Bloomberg Intelligence analyst Mandeep Singh.
The company’s shares closed at $39.10 Friday in New York, giving it a market value of about $2.2 billion. The stock has dropped 17% since hitting a 52-week high on Sept. 28.
Praesidium, a sometimes-activist investor, filed a 13D at Cornerstone in February. It has helped coax other software companies to sell, including Tibco Software Inc. in 2014, Informatica Corp. last year and JDA Software Group Inc. in 2012. Cornerstone also counts activist investor Corvex Management LP among its biggest shareholders.
Representatives of Cornerstone and Praesidium declined to comment.
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