Exclusive: Dell bids $2.32 billion for Quest Software: source

By Nadia Damouni and Supantha Mukherjee

(Reuters) - Quest Software Inc has received an improved bid from Dell Inc to buy the maker of enterprise management software for about $2.32 billion, a source close to the matter said on Monday.

Two bidders have recently been competing to buy Quest: a buyout group led by private investment firm Insight Venture Partners, and an undisclosed bidder.

On Monday, a source close to the matter told Reuters that the mystery bidder was actually Dell, the No. 2 U.S. PC maker. Quest disclosed on Monday that it had received an improved bid of $27.50 per share in cash from the mystery bidder, but did not reveal the bidder's identity.

Reuters reported on May 25 that Dell planned to offer $23 to $26 per share to buy Quest. The source who spoke to Reuters on Monday requested anonymity because the takeover talks are private.

Dell declined to comment on Monday, and a Quest representative was not immediately available for comment.

Major tech companies have often preferred to keep their identities private when bidding wars heat up. This helps prevent the bidder from feeling compelled to overpay and also spares it the public embarrassment of an unsuccessful takeover attempt.

One of the last public battles occurred when Dell fiercely competed against Hewlett-Packard Co for data storage company 3Par Inc in 2010.

Dell spurred that fight with an $18-a-share bid, but HP ended up buying the company for $33 a share.