BOSTON - Business software maker BEA Systems bought more time to try to sell itself on Thursday, postponing a possible proxy battle with its largest shareholder, Carl Icahn, who also withdrew his lawsuit against BEA's board of directors.

BEA said it will delay its annual meeting by a month, which gives it extra time to drum up a bid close to its aim of $21 a share and allows it to release quarterly results ahead of the meeting.

Icahn sued the board and threatened to nominate new board members to pressure the company to sell itself through an auction process. He had until the end of the year to submit nominees to the board to get their names in the proxy materials that BEA will mail out to subscribers.

In delaying the meeting, BEA also postponed that deadline, though it wasn't immediately clear what the deadline would be for getting into the company's proxy mailing.

The company postponed its annual meeting to March 18 from Feb. 14, saying it wants to release quarterly results before the gathering.

That also gives it time to work with its investment bankers, Goldman Sachs, on finding a buyer with an offer to the liking of BEA Chief Executive Alfred Chuang.

Icahn's withdrawal of the lawsuit was detailed in a court document released by the Court of Chancery of the State of Delaware on Thursday.

The document said Icahn had supported the postponement of the meeting and he and BEA had settled the lawsuit he had filed complaining about previous delays in holding a meeting.

Icahn had no comment.

Icahn has been critical of Chuang and the company's rejection of a bid from Oracle to buy BEA for $17 per share, or $6.7 billion.

In response, the company had said it would enter into talks with Oracle and other potential buyers if they agreed to start negotiations at $21 a share, valuing the company at $8.2 billion.

No other bidders emerged. Oracle withdrew its offer and the company's chief executive, Larry Ellison, said the lack of other suitors showed that BEA was not worth his original offer of $17 a share.

On Thursday, BEA closed Nasdaq trade up 25 cents, or 1.6 percent, at $15.97. They had hit a 52-week high of $18.94 on Oct. 12 amid hopes other bidders would emerge, forcing a sale of the company closer to $19 a share.

BEA said in its statement that shareholders of record as of Jan. 22 will be able to vote at the shareholders meeting.

Shareholders will have until March 7 to propose director nominees and bring proposals to the meeting.

On Wednesday, Oracle had disclosed that it had renewed its efforts to negotiate a sale with BEA, but that they had not been successful.

"Over the last few weeks we have been in contact with their bankers and lawyers and as a result of those discussions, we've concluded that no friendly deal can be done with the current BEA Board at a price and terms acceptable to Oracle," Chief Financial Officer Safra Catz said during an earnings conference call.

A spokesman for Oracle declined comment on the matter on Thursday. (Reporting by Jim Finkle; Editing by Jeffrey Benkoe, Gary Hill)

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