Compuware rebuffs Elliott takeover offer Compuware has rebuffed a takeover attempt by Elliott Management, the activist hedge fund, and said it was instead spinning off a division, reducing costs and implementing a substantial dividend. The announcement from the Detroit-based business software maker came about six weeks after Elliott made a $2.3bn offer for the 92 per cent of shares it did not already own. The offer, of $11 a share, represented a 25 per cent premium over the stock's undisturbed price. Shares in Compuware rose 7.5 per cent on the news to $11.57 at the close, surpassing Elliott's offer and suggesting that investors have faith in the management's strategy. "We believe that selling the company at $11 per share does not take into account our progress returning the business to profitable growth and our future prospects," said Bob Paul, Compuware chief executive. But Mr Paul suggested that the company was open to a deal in the future. "While we are focused on executing and delivering on our plan, the board will carefully review and evaluate any credible offer it receives, including from Elliott, that delivers full value to its shareholders," he said. Elliott made its offer after Compuware had underperformed against the Nasdaq Composite and S&P 500, saying it believed in the value of the company's assets but that "its execution, profitability and growth have meaningfully underperformed." It was the second attempt Elliott made last year to take control or agitate for the sale of a large software company. Its bid for BMC Software ended with an agreement with the company that installed Elliott representatives on the BMC board, but shelved a sale process for the time being. Elliott was founded by Paul Singer, who grew the fund into an aggressive activist over decades, and made himself a billionaire in the process. On Friday Compuware laid out its plans to revive the company. It said it would reduce expenses by $60m over three years in a bid to improve profitability. The spin-off of its Covisint division will continue as planned. The company expects to distribute 80 per cent of shares to Compuware shareholders within 12 months of an initial public offering. It also announced an annual dividend of 50 cents per share, a yield of more than 4.5 per cent based on the current share price. The plan was outlined just days after Compuware announced strong quarterly earnings, with increases in revenues and profits.