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- Climb's M&A Weekly: Experian, Bubble and Bain Capital all feature
Climb's M&A Weekly: Experian, Bubble and Bain Capital all feature
Bain Capital completes a deal for cloud-based software provider and Experian acquires Brazilian firm to bolster its cybersecurity offerings.
Nick @ Climb
October 06, 2024
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Welcome to Climb Advisor’s weekly deal newsletter highlighting transactions announced last week across the B2B tech landscape.
Climb Advisors is an M&A and credit advisory firm focused on B2B software and services companies in the range of $5m to $100m+ enterprise value. We guide CEOs and business owners through the process of selling their business & assist investors in sourcing & closing great deals. We love to talk markets and share beneficial information - please reach out any time.
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Bubble Acquires Flusk to Enhance Security Features
Overview: Bubble, a leading full-stack, no-code app builder acquired Flusk, a Bubble focused security and monitoring business. Flusk’s integration into the Bubble ecosystem will offer users access to its guided security audits, a user friendly dashboard, simplified log exploration for easier debugging, and advanced penetration testing services with clear, actionable results. Read more here.
Climb Comment: Cybersecurity/Risk demand continue to drive M&A activity - with Bubble now able to offer cybersecurity out of the box to the more than 3 million entrepreneurs, enterprises, & developers building apps on it’s no code solution. Flusk has been focused on building for Bubble from the start, always helpful in a technical-driven acquisition.
UST Acquires ISG Automation
Overview: UST, a leading digital transformation solutions company has acquired the automation unit of Information Services Group (ISG), strengthening its position in the intelligent automation space and positioning the company for future growth in a dynamic market. The all-cash transaction valued the business at $27 million. Initially founded in 2017, the acquired unit offers RPA software implementation, support, and licensing services. The unit has over 120 senior automation consultants and technologists across US, UK, India, Canada, and Germany. Read more here.
Climb Comment: UST provides digital transformation for enterprise clients worldwide, focusing on CPG, healthcare, manufacturing, & public sector clients. In a move to keep pace with growing demand for Gen-AI driven services UST has acquired ISG & their team of automation consultants. Interesting to see divestiture activity — ISG stock is down ~30% YTD and the $27m in cash from this deal will be a welcome addition to the ~$12m disclosed in June.
PowerSchool to be acquired by Bain Capital in $5.6 Billion transaction
Overview: PowerSchool Holdings, a public company that provides cloud based software for K-12 education, announced that it has entered into an agreement to be acquired by Bain Capital in a transaction worth $5.6 billion. PowerSchool stockholders will receive $22.80 per share in cash upon completion of the proposed transaction. The per share purchase price represents a premium of 37 percent over PowerSchool’s unaffected share price of $16.64 as of May 7, 2024, when the deal was reported in media. Read more here.
Climb Comment: PowerSchool is one of the largest names in K-12 edtech, in the US and globally. PowerSchool offers a full suite ranging from SIS (student information service - record keeping around student data), to personalized learning & career readiness as well as products for schools and districts to recruit talent & manage finances and planning. With the size of the edtech market and the scaled base platform there is still room to expand both geographically and via adding modules organically and through further M&A. Vista acquired PowerSchool from Pearson Education in 2016, sold a stake to Onex in 2018, and in 2021 Vista & Onex led a $3.5B IPO for the business. $2B in equity value creation in 3 years — not bad! Bain is acquiring @ roughly 8x ‘23 ARR. In ‘23 filings PowerSchool showed a 33% adj ebitda margin. Maybe some room for margin improvement via AI but have to assume topline growth will be a priority - PowerSchool grew total revenue 11% from ‘22 to ‘23. Kudos to all
VisiQuate completes deal with Accel-KKR
Overview: Based in California, VisiQuate is a provider of advanced revenue cycle analytics, AI-powered workflow and automation for the healthcare sector. VisiQuate’s solutions help healthcare organizations optimize revenue cycles and financial performance. The acquisition positions the company for expanded market reach and to deliver greater value to clients. Read more here.
Climb Comment: Healthcare orgs face tremendous administrative complexity and challenges in collecting timely payments. VisiQuate offers a suite of tools which go beyond traditional dashboarding/BI to provide real time insights into payment status, flows, and opportunities for efficiency. Visiquate shows 239 employees on LinkedIn (130+ in Ukraine) and has most recently raised $50m from Sixth Street in 2021.
Experian acquires Brazilian cyber security firm ClearSale in $350 million deal.
Overview: After a couple of turbulent years, credit data company Experian is on the M&A path to spur its international growth. Experian, the publicly listed company, announced the $350m acquisition - of ClearSale, a Brazilian cyber security firm which reflects 10.56 reais per share of ClearSale implying a 23.5% premium over the Brazilian stock's Oct. 3 closing price. Read more here.
Climb Comment: Experian’s local subsidiary Serasa has a leading position in credit information in Brazil and believes this "highly complementary" deal will enhance its identity and fraud (ID&F) business in the country, which is the largest and fastest- growing economy in Latin America. Cybersecurity again plays an important role in driving transaction activity. Brazil is a unique market in that it is scaled & growing and yet still offers close to emerging market opportunity in fields like credit reporting. Experian acquired ClearSale @ roughly 3.5x ‘23 revenue.
Article of the week
A great blog post by Brian Halligan, co-founder and ex-CEO of Hubspot this week, in which he outlines learnings and observations on things that worked (and didnt work) for him + Hubspot scaling from $0 to $25BN. Well worth a read for CEOs and investors. See more here.
Thanks for following along & hope you found something useful or interesting.
All the best,
Nick