Business management software developer Apptio is leaving public markets after agreeing to acquisition by Vista Equity Partners in a $1.94 billion deal.
Apptio went public only two years ago, having closed its IPO in September 2016 at $16 per share. As part of the Vista deal, Apptio shareholders will receive $38 in cash per share, or a 53 percent premium to the unaffected closing price.
“Since founding, our focus has been on building the next great cloud software platform by dedicating ourselves to helping companies of all sizes and industries manage, plan, and optimise technology investments across their hybrid IT environments,” said Sunny Gupta, Apptio co-founder and CEO.
“Vista’s investment and deep expertise in growing world-class SaaS businesses and the flexibility we will have as a private company will help us accelerate our growth while helping us maintain our commitment to creating wildly successful customers.”
Gupta added that after the Apptio acquisition company remains “deeply committed to our mission, product innovation, and geographical expansion”.
Apptio Looks to Turn Profit with Acquisition
Apptio will keep its headquarters in Bellevue, Washington, and its regional offices across the US, EMEA, and APAC.
The deal is set to close in Q1 2019 and is subject to closing conditions, including the approval of Apptio shareholders. Apptio’s board of directors recommended that stockholders vote their shares in favour of the deal.
The merger also includes a three-day “go shop” period, allowing Apptio’s board and advisors to seek and potentially enter negotiations with parties that make alternative acquisition proposals.
Apptio will have the right to terminate the Vista deal to enter a superior proposal, subject to terms and conditions.
Apptio, which offers cost analysis software and cloud-based apps for IT leaders to manage technology investments, last month reported Q3 revenue of $59 million, a 26 percent year-on year growth, but saw a net loss of $4.6 million.
Gupta had said in a conference call for its Q3 results that the company has continued confidence in its ability to move down market and mentioned adding resources to capture the midmarket segment.
Apptio’s shares had recently fallen and the purchase price is below its peak closing price of $41.23, which it hit around two months ago, according to MarketWatch.
Vista invests exclusively in software, data, and tech organisations and currently has more than $43 billion in capital commitments.
Brian Sheth, co-founder and president of Vista, added: “Today, with companies across sectors increasingly depending on technology to stay competitive, IT is becoming a critical component for every business on the planet, and Apptio has created the leading platform to help customers manage this new paradigm.”
Before the Apptio acquisition, the firm sold B2B marketing software vendor Marketo to Adobe for $.75 billion in September.