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7/18/2012
09:16 AM
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Workday Rumored To File For IPO

ERP and human capital management software-as-a-service provider has confidentially filed for what would be the largest initial public offering since Facebook's.

Workday has filed confidentially for an initial public offering, Reuters reported Tuesday. An IPO by the cloud-based ERP and human capital management applications would be the first since Facebook's troubled May offering, which put a chill in demand for U.S. public offerings.

Workday's IPO is planned for October, depending on market conditions, sources told Reuters, and the banks running the offering will include Morgan Stanley, Goldman Sachs, and JP Morgan.

Pleasanton, Calif.-based Workday was co-founded by David Duffield, the founder and former CEO of PeopleSoft, and Aneel Bhusri, PeopleSoft's former chief strategist. Both executives left PeopleSoft following its 2004 acquisition by Oracle. Workday is financially backed by Amazon CEO Jeff Bezos.

Sources told Reuters that Workday filed for its IPO last week under the new Jumpstart Our Business Startups (JOBS) Act, which lets companies keep the financial details of their offerings confidential until 21 days before their IPO road shows.

[ Want more on Workday? Read Workday Courts Mobile Users, Large Enterprises. ]

Facebook's IPO sapped the confidence of many investors after the company's stock lost a third of its value after its May 18 debut. But corporate software companies, with stable, long-term subscription revenues, are faring well in an otherwise weak IPO market, Reuters reported.

Big data software provider Splunk's stock is up more than 50% since its April IPO. And collaboration vendor Jive Software had seen its stock more than double since its December debut at $12 before settling into the $18-to-$21 range in recent weeks.

Human capital management has long been Workday's strongest service offering, and it's a market that's consolidating with SAP's February acquisition of SuccessFactors and Oracle's April purchase of Taleo. Workday caters primarily to midsize firms, and its strongest industry segments include healthcare, higher education, the public sector, technology companies, and service businesses.

The timing of Workday's IPO could put the company in the limelight during rival Oracle's big annual Oracle Open World event. Oracle CEO Larry Ellison recently took swipes at Workday when he unveiled Oracle's cloud offerings. Workday executives declined to comment on Ellison's remarks.

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