Coupa Software Inc, an incredible cloud-based platform that captures expenses digitally with a vision to flip invoices via emails, working harder in order to let the users relax, has recently agreed to sell itself to a private equity major, namely Thoma Bravo. The deal is valued as huge as $8 Billion.
The news of the signed deal consigned Coupa’s shares at an accelerated growth by nearly 27% after a major drop of 60% this year. Coupa’s shareholders are expected to receive $81 per share, fixed under the deal itself.
The Ukraine crisis, high inflation, weak consumer demand, and the decline in global stock prices have been affecting businesses globally, with the tech industry taking the worst of the blow. Due to this, PE firms are now able to purchase rapidly expanding software companies for less money.
According to Roger Siboni, an independent director at the software firm, “The transaction provides superior risk-adjusted value relative to the company’s (Coupa’s) standalone prospects”.
Moreover, with this deal, it has been recognised that the all-cash deal had an enterprise value of up to $8 Billion, which was not an all-in-all straight amount but also involved debts with the minority investment. This investment came from an affiliate of a sovereign wealth fund via Abu Dhabi Investment Authority.
Financial Steps Taken For The Acquisition of Coupa Software
It has been clearly stated that the acquisition of Coupa Software has been financed partly by a group of 19 direct Lenders. These lenders were led by Sixth Street, willing to provide a loan package worth $2.6 Billion.
Apart from these 19 direct lenders, there were other lenders who were included with the HPS Partners, Oaktree Capital Management, Apollo Global Management and Blackstone.
After the all-cash deal was signed, Coupa investor HMI Capital committed to supporting a potential deal worth more than $95 per share of the company. Though this deal was not responded back. On the other hand, Vista Equity Partners were also interested in participating in this deal.
Down the memory lane, back in 2016, Coupa Software provided business-spend management software that has incredibly helped companies manage the purchase of their goods and services.
On the contrary, Qatalyst Partners and Freshfields Bruckhaus Deringer advised Coupa, while Goldman Sachs & Co, Piper Sandler, and Kirkland & Ellis were responsible for advising Thoma Bravo.
Coupa Software is Thoma Bravo’s latest and biggest transaction of this year after signing similar deals involving software companies such as Anaplan, Ping Identity, ForgeRock and Sailpoint Technologies.
After thorough rounds, Coupa reported a 17% rise in total revenue for the quarter that ended Oct. 31 with a net loss of $84.1 million.
Coupa Software, founded in 2006, is a cloud platform for business spending management widely available to be used from a broader perspective. Coupa intends to empower companies all around the world, enabling a smarter and safer way out, helping you gain visibility into and have strong control over the ways of spending money, optimising the supply chains and managing liquidity in its true element. The company is headquartered in San Mateo, California, with office branches in Europe, Latin America and Asia Pacific.
About Thoma Bravo
Thoma Bravo, established in 2008, is a leading private equity investment firm, has been actively providing capital and strategic support to highly experienced teams. Over the course of time, their success rate is proven to be as high as 420+ transactions. According to the report of 2021, it was listed as the highest-growing major buyout firm in the world.