SaaS giant Zendesk to go private in $10.2 bn deal
The San Francisco-based software company Zendesk said its shareholders would get $77.50 per share in cash, a premium of 33.7 percent over the stock’s most recent closing price.
In a $10.2 billion agreement, Hellman & Friedman and Permira will take Zendesk private, reversing the company’s earlier decision to stay public. According to Zendesk, the offer from Hellman & Friedman came along after the formal process was over.
The Abu Dhabi Investment Authority (ADIA) subsidiary and the GIC (GIC.UL), sovereign wealth fund of Singapore, also joined the investor group. Permira and Hellman & Friedman claimed to have secured loan and equity financing commitments.
This agreement was favorable for activist investor Jana Partners, which holds a stake of almost 2.5 percent in the tech firm. Jana has been urging the business to sell itself after it could not complete the $3.9 billion acquisition of SurveyMonkey-parent Momentive Global. After being rejected by Zendesk shareholders, the Momentive acquisition ceased. Zendesk will avert losing board seats in a proxy battle with Jana at the company’s annual meeting in August by accepting the most recent offer from Hellman & Friedman.
According to Craig-Hallum analyst Jeff Van Rhee, “If this is the end for it as a public entity, I think most would see it as a very disappointing ending.”
Taking 122.54 million outstanding shares as a basis, Refinitiv data shows that the deal’s equity value, which is anticipated to settle in the fourth quarter, is $9.5 billion.