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2022-04-11 18:15

SailPoint Technologies Inc stock closed up about 30% on Monday after Thoma Bravo, a private equity group, announced its plan to buy it for $6.12 billion.

The announcement highlights the increased interest in the security software market. Owing to a pandemic-driven trend to remote working, as well as the Russia-Ukraine crisis, which has resulted in an increase in cyberattacks, cyber security is a hot business right now, attracting billions of dollars in investment.

SailPoint's Chief Executive Officer Mark McClain said:

“The go-private deal, expected to close in the second half of this year, would allow the company to pursue long-term growth with greater flexibility and expand their markets on the back of additional capital from the private equity firm. We’re about 10% penetrated in our target market. We have a lot of room to grow in terms of what we add to our portfolio.”

Why is Thoma Bravo interested in acquiring SailPoint
Thoma Bravo's latest acquisition will strengthen its position in the security-focused area, where it has significant stakes in companies such as Barracuda Networks, Blue Coat Proofpoint, Sonicwall, and Sophos. Prior to its IPO in 2017, Thoma Bravo, which controls more than $103 billion in assets, was the biggest shareholder in SailPoint. By the end of 2018, it has left its position.

Thoma Bravo has extensive experience establishing industry-leading software brands such as SailPoint, which are positioned for major market leadership and development. SailPoint provides a long history in identity security as well as a deep commitment to delivering innovation at the speed that today's industry needs. The operational and financial resources of Thoma Bravo, together with SailPoint's goal of delivering consistent innovation that results in long-term client success, will put SailPoint on a track to long-term success.

Details of the agreement
SailPoint stockholders will receive $65.25 in cash per share, according to the business, which marks a 31.6 percent premium over Friday's close. The total acquisition value, including debt, is around $6.9 billion. In early trading on Monday, shares of Austin, Texas-based SailPoint, which was launched in 2005, were trading around 30% higher. In 2021, they had lost 9.2% of its value. Seth Boro, a Managing Partner at Thoma Bravo said:

“SailPoint is ideally positioned to capitalize on the large and growing demand from modern enterprises for robust identity security solutions that secure their business and reduce risk. Their market-leading identity security platform provides the autonomous and intelligent approach that the market requires today, especially among larger enterprises and as hybrid working becomes more common.”

SAIL is now up more than 75% from its low in late January.