Private equity firms have been actively engaging in the public markets in 2024, making significant deals to transform underperforming companies. According to PitchBook, there were 136 take-private deals led by private equity firms in 2023, reflecting a 15% increase from the previous year. The trend seems to be continuing this year, with 97 deals already closed or set to close. Among these deals, 46 belong to the technology sector.
One notable deal is the acquisition of cybersecurity firm Acronis by private equity firm EQT at a valuation of around $4 billion. This follows EQT’s previous acquisition of enterprise middleware company WSO2 for $600 million. These deals highlight private equity’s role as an alternative source of liquidity for technology startups and scale-ups.
In the technology sector, there are several take-private deals focused on product-centric companies. Some of these deals are valued at $1 billion or more. For example, Adevinta, a classifieds platform, was taken private in a deal worth $13 billion. The Norwegian media group Schibsted spun out Adevinta as a standalone business in 2019 and later acquired eBay’s classifieds business for $9.2 billion. Private equity firms Permira and Blackstone led a consortium to take Adevinta private.
Website builder Squarespace is another notable take-private deal. Private equity firm Permira plans to acquire Squarespace in a $6.9 billion all-cash deal. Squarespace had previously filed to go public in 2021 but faced a decline in its stock value. However, the company’s market cap has been on the rise this year, prompting Permira to take action.
Canadian fintech company Nuvei, which provides payment processing services, entered into an agreement to be taken private by Advent International for $6.3 billion. Nuvei had previously filed to go public in 2020 but faced a decline in its valuation before the take-private deal.
PowerSchool, a K-12 education software provider, is in the process of being taken private by Bain Capital in a $5.6 billion transaction. PowerSchool had been acquired by Apple in 2001 and later sold to Pearson before being spun out as a public company. The take-private transaction is expected to conclude in the second half of 2024.
UK cybersecurity giant Darktrace is set to go private in a $5.3 billion deal led by private equity firm Thoma Bravo. Darktrace had raised significant funding before going public in 2021, and the offer from Thoma Bravo represents a substantial valuation.
Educational technology company Instructure is being taken private again by KKR in a $4.8 billion deal. Instructure had previously gone public in 2015 but was later taken private by Thoma Bravo. The deal is expected to close in late 2024.
Data analytics software provider Alteryx was taken private in a $4.4 billion deal. Alteryx had gone public in 2017 but faced a decline in its market cap. Clearlake Capital Group and Insight Partners stepped in with their offer, resulting in the take-private transaction.
Customer engagement software provider EngageSmart was taken private by Vista Equity Partners in a $4 billion deal. EngageSmart had gone public in 2021 but received the offer from Vista Equity Partners, leading to the transaction.
Pet-sitting marketplace Rover went public in 2021 but was later acquired by Blackstone for $2.3 billion. The all-cash transaction closed in February, making Rover a private company once again.
Critical event management software company Everbridge was acquired by Thoma Bravo for $1.8 billion. Everbridge had gone public in 2016 but faced a decline in its market cap. Thoma Bravo’s offer increased the valuation of the company.
Gamified e-learning platform Kahoot was acquired by a consortium led by Goldman Sachs Asset Management for $1.7 billion. Kahoot had gone public on the Oslo Stock Exchange and received the offer, leading to the transaction.
Model N, a platform that helps automate pricing and compliance decisions, went private in a $1.25 billion deal led by Vista Equity Partners. Model N had gone public in 2013 but faced a decline in its market cap. The transaction concluded in June 2024.
These take-private deals in the technology sector demonstrate the active role private equity firms are playing in transforming underperforming companies and providing liquidity for startups and scale-ups. These deals offer opportunities for companies to reposition themselves and drive growth in the evolving technology landscape.