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Squarespace, the vendor of software program utilized by entrepreneurs and companies to construct web sites, is being taken non-public in a $6.9bn deal simply three years after it was taken public by its founder and personal fairness homeowners.
London-based non-public fairness group Permira has agreed to purchase the corporate for $44 a share in money, a 15 per cent premium over Squarespace’s closing worth on Friday. Shares within the tech group are down by a few fifth since going public through a direct itemizing in 2021, when the pandemic drove a wave of latest start-ups to its web site design and ecommerce instruments.
At virtually $7bn, together with debt, the transaction funded by a consortium of personal credit score backers is among the largest offers ever supported by non-bank lenders, highlighting the rising affect these establishments have within the mergers and acquisitions enterprise.
Non-public credit score funds together with Blackstone’s credit score arm, Blue Owl and Ares Capital are offering the financing for the deal, in line with an organization launch. Non-public credit score funds have more and more been tapped by non-public fairness corporations for leveraged buyouts as the price of debt financing has elevated.
The takeover continues a development of multibillion-dollar takeovers of corporations that have been taken public by non-public fairness teams between 2019 and 2022, when markets have been buoyant.
Squarespace’s present non-public fairness buyers, Common Atlantic and enterprise capital agency Accel, which collectively personal greater than 20 per cent of the corporate, will take part in Monday’s takeover alongside the software program firm’s founder Anthony Casalena.
Non-public fairness teams have struck a handful of latest offers to take non-public corporations that have been lately listed over the previous few years by themselves or different non-public fairness teams.
Final yr, Blackstone acquired Cvent, a Vista Fairness-owned occasions software program firm that had gone public in 2021 via a merger with a clean cheque firm. Earlier this yr, Silver Lake struck a greater than $13bn take-private deal for Endeavor, a stay sports activities and leisure firm with a big expertise company, by which it’s already a controlling shareholder.
Casalena, who based New York-based Squarespace in 2003, will stay in his position and roll over a “substantial majority” of his shareholding, in line with an announcement. Casalena’s shares are price about $2bn at present costs, in line with securities filings.
Goldman Sachs acted as monetary adviser to Permira, whereas Latham & Watkins gave the non-public fairness agency authorized recommendation. Squarespace labored with JPMorgan on the monetary phrases of the deal, and Skadden Arps supplied authorized counsel.