PLEASANTON, California: Private equity firm Silver Lake is in talks to acquire Workday in a potential deal that would rank among the largest software buyouts in history, according to people familiar with the matter.

News of the discussions sent shares of the human-resources and financial management software company nearly 18 percent higher on August 13.

Silver Lake and Workday have held talks about a potential deal in recent months, the people said. Discussions are continuing, and there is no guarantee a transaction will materialize, according to the sources, who spoke on condition of anonymity because the talks are confidential.

Workday had a market value of around US$43 billion before Reuters reported the discussions. Its shares closed at $206.45 on August 13 following the surge, giving the Pleasanton, California-based company a market capitalization of about $51.1 billion.

Silver Lake could bring in additional investors to help finance an acquisition, one person said. The private equity firm teamed up with Saudi Arabia's Public Investment Fund and Affinity Partners for its roughly $55 billion take-private deal for videogame maker Electronic Arts last year.

Neither Silver Lake nor Workday immediately responded to requests for comment.

Before the rally on August 13, Workday shares had fallen about 15 percent this year as investors questioned the durability of traditional software amid rapid advances in artificial intelligence. The stock was more than 40 percent below its 2024 peak.

Private equity firms have largely stayed away from major software buyouts this year, as uncertainty over AI has made it harder to assess the future growth and value of traditional software companies.

That has contributed to a shortage of large software take-private deals. Hg Capital agreed in January to take financial software maker OneStream private for about $6.4 billion, while Thoma Bravo previously agreed to acquire payroll software provider Dayforce in a transaction valued at about $12.3 billion.

A Workday acquisition would be significantly larger and would represent one of the biggest tests yet of private equity appetite for traditional software businesses as AI reshapes the industry.

Silver Lake has previously invested in technology and software companies including Dell Technologies, VMware and Qualtrics.

Founded in 2005 by former PeopleSoft executives Aneel Bhusri and David Duffield, Workday provides cloud-based software for human resources, payroll, finance, spending and planning. It serves more than 11,500 customers globally.

Bhusri returned as chief executive in February as Workday navigates growing AI-related pressure on traditional business software.

Workday reported fiscal 2025 revenue of $9.6 billion, up 13 percent, and operating cash flow of $2.9 billion, up 19 percent. Revenue growth slowed from 16 percent the previous year.