(Bloomberg) -- Spain and the board of Indra Sistemas SA are mulling options for the company after an activist shareholder called for it to be broken up, people familiar with the matter said.

Board members have discussed possibilities for Indra’s future since activist hedge fund Amber Capital LP said Nov. 22 that the state-controlled company should be split in two by separating its defense activities from information technology, said the people, asking not to be named discussing confidential information. Still, the board hasn’t had any formal deliberations on a break-up, they said.

Any sale of the technology division could be politically sensitive due to the thousands of jobs at stake, some of the people said. Still, while the impact on jobs is a concern, it’s unlikely to be a deal-breaker if a decision is made to split up the company or sell the unit, they said. 

Press officers for Indra and for the government’s corporate investment holding, which controls the stake in the company, declined to comment. Spain owns 25% of Indra, according to regulatory data, and has said it wants to reach 28%.

Shares jumped as much as 6.3% to €10.7 per share at 1:43 p.m. in Madrid, the biggest rise since July 7. 

The board is unlikely to make a decision before the government signals its preference, one of the people said. Half of the board is formed by independents, the majority of whom were appointed in late October. Potential investors have already shown informal interest in the technology unit, the person said. 

Amber Chief Executive Officer Joseph Oughourlian, whose fund owns 5% of Indra, said that each of the two spun-off units could potentially be worth as much as the current €1.8 billion ($1.9 billion) market value of the full company, and called for a split-up, or for the technology unit to be sold or merged with another firm. 

Indra’s defense division is the more profitable of the two units, and is widely considered to have strong growth prospects -- especially if Spain delivers on its pledge earlier this year to ramp up military spending. The technology unit, known as Minsait, accounts for the bulk of revenue, offering consulting services in a range of sectors and providing voting systems. 

The two divisions were carved out within the company under previous Executive Chairman Fernando Abril-Martorell, who was replaced in 2021 by Marc Murtra, who serves as a non-executive chairman. Murtra, a government nominee, has signaled in the past that he’s not opposed to splitting the company up.

(Updates with shares in fifth paragraph)

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