MSC and Elliott Assoc. reach agreement on “standstill”

Elliott Associates and MSC Software today filed a schedule 13D with the SEC stating that the two had reached and agreement under which the various Elliott entities that already own 13.4% of the outstanding shares of MSC will not buy more than 2.96 million additional shares before June 30. The current stake plus a potential 3 million more shares would combine to give Elliott a 20% stake in MSC, enough to trigger MSC’s poison pill provisions and likely to give Elliott control of the board and affect management decisions. Also under this agreement the Elliott entities will not nominate anyone for election to MSC Software’s board until June 30. This is good for MSC because it means that, at least until June 30, the company can run itself as it sees fit, with minimal interference from Elliott. Joanne Keates, MSC’s Vice President of Investor Relations, says that Elliott agreed to this “standstill” in exchange for access to specific information (under NDA) about MSC’s business. So now the question is: What happens on July 1?