NEW YORK/BOSTON (Reuters) - Ultimate Software Group Inc has hired an investment bank to review a possible sale of the cloud-computing company, said three sources familiar with the situation.
The Weston, Florida-based software maker has hired Lazard as its banker, one of those sources said.
Ultimate Software Chief Financial Officer Mitchell Dauerman declined to comment, as did a spokeswoman for Lazard.
Ultimate is considering selling itself as its valuation is at sky-high levels during an investment craze for fast-growing cloud-computing companies.
Cloud computing refers to the use of Internet technology to move computers and information away from desktops into remote data centers. Ultimate and peers such as Salesforce.com Inc and NetSuite Inc host software at their data centers, allowing customers to access the programs via ordinary Web browsers. That saves them the cost of running it on their own computers, while making implementation of the software relatively fast and inexpensive.
Ultimate Software trades at 107 times the average forecast for earnings per share in the coming year, versus an average of 18 times for software services companies tracked by Thomson Reuters.
The software maker has been talking to potential buyers for about a month, according to two people familiar with Ultimate’s activities.
The people familiar with the situation said that a list of possible buyers could include Salesforce.com Inc, privately held Ceridian, Paychex, Oracle Corp and SAP AG.
Ultimate shares rose 0.9 percent to close at $53.29 on Nasdaq.
Reporting by Nadia Damouni and Jim Finkle; Editing by Richard Chang, Bernard Orr