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LONDON — British software company Blue Prism said Tuesday it has agreed a deal to be taken over by private equity firm Vista Equity Partners for £1.1 billion ($1.5 billion) in cash.
Blue Prism, which specializes in software robots that automate repetitive tasks, said Vista would pay each shareholder £11.25 per share, a 35% premium to the company’s last closing price of £8.32.
The latest deal in a series of private equity investments for publicly-listed software firms is this. Earlier this year, security firm Proofpoint agreed a $12.3 billion sale to Thoma Bravo, while Cloudera is being bought by KKR and Clayton, Dubilier & Rice.
Blue Prism also features among the many British businesses that attracted attention from U.S. investors. Supermarket chain Morrisons, infrastructure company John Laing and aerospace firm Cobham have all been the target of takeover bids in recent months.
Vista stated that it will transfer Blue Prism indirectly to its portfolio company TIBCO (an enterprise data provider) after the purchase was completed.
Jason Kingdon is chairman and CEO at Blue Prism. “Combining Vista with TIBCO and will ensure that we continue to be at the forefront for the next generation in intelligent automation,” he said.
“We can expand the range of products we offer our customers, with TIBCO’s global footprint and technologies; and, as a privately owned company, we will also have greater access to capital to pursue new growth opportunities via product investment and other potential M&A.”
The price for Blue Prism marks a major discount to U.S.-based rivals such as UiPath, the New York-listed company with a $28 billion market cap, and Automation Anywhere, which was last privately valued at $6.8 billion.
Blue Prism shares fell 2.6% on Tuesday morning.
Activist investor Coast Capital had expressed concern about the valuation of the company amid speculation it was set to be taken over by private equity buyers.
Coast Capital wrote that the Enterprise Value of Blue Prism PLC was currently at around three times future revenues. This is a 80%-90% discount to its peers such as UiPath and WorkFusion.
The share price of Blue Prism PLC would be significantly lower than its intrinsic value if a buyer paid a premium to 100%. This is well below the trading prices as recent as January 2021.
This report was contributed by Elliot Smith, CNBC.