Shares of CCC Intelligent Solutions gained Monday following a report that said Elliot Investment Management and a private-equity firm were in talks to potentially acquire the car-insurance-software company.
The takeover interest could signal to investors that anxiety over artificial-intelligence disruption facing software providers might be waning.
Elliott Investment Management and GTCR could announce an agreement to acquire CCC early as next week, Bloomberg reported, citing sources who requested anonymity. Talks, however, could still fall through, timing might shift, or another bidder could emerge, the sources said.
CCC Intelligent Solutions stock jumped 11% to $7.78 in premarket trading Monday. The stock was heading for its highest closing level since Jan. 28, according to Dow Jones Market Data.
CCC Intelligent Solutions is a cloud software company that connects everyone involved in fixing cars after an incident. The business provides a central platform across the U.S. and China where car manufacturers, insurance companies, and auto repair body shops can share data and work together.
Among some investors, the idea that AI could render software businesses obsolete remains persistent. While those concerns could be overblown, software stocks have tumbled as a result.
CCC Intelligent Solutions stock has fallen 16% over the past 12 months, according to Dow Jones Market Data.
CCC Intelligent Solutions has tried to combat potential disruption risk by using AI to automate vehicle damage estimates, manage claims workflows, and streamline parts ordering.
A deal, however, could brush off these fears for investors.
This isn't the first time CCC Intelligent Solutions has been the subject of takeover reports. In July, shares jumped after Reuters reported the company was exploring a possible sale and had contacted interested parties, including private-equity firms.
Though the deal wasn't confirmed, Wall Street analysts saw strong potential for the deal, citing the company's valuation, robust network, and appealing position in the insurance-tech market as key drivers for a premium buyout.