Clearwater cybersecurity training company KnowBe4 has received a multibillion-dollar offer to go private.
Austin, Texas, private equity firm Vista Equity Partners has made the company a buyout offer of $24 per share, a 39% premium over Friday’s closing price of $17.30, in a deal that values the company at $4.2 billion.
Companies tied to Vista already own 13.5% of voting shares of KnowBe4, including 2.6% of its Class A common stock and 14.3% of its Class B stock, according to U.S. Securities and Exchange Commission filings. In many cases, Class B stock is less valuable than Class A stock because it carries restricted shareholder rights — but KnowBe4 considers Class B shares to be identical in value, convertible to Class A shares at the option of the holder.
Subtracting the Class A and B shares that Vista’s companies already own, the equity group’s offer to buy all remaining shares would be worth approximately $3.8 billion.
“We have been investors in the company since early 2021 and we have a deep understanding and appreciation of the company’s business as well as the opportunities and challenges facing the company,” Vista founder and CEO Robert F. Smith said in a letter to KnowBe4.
In a statement, KnowBe4 said it has formed a committee of independent directors to weigh Vista’s offer “and other potential value creation opportunities to determine the course of action that it believes is in the best interests of KnowBe3 and its stockholders.” The company said it will not comment further until the committee makes its decision.
Founded in 2010, KnowBe4 trains clients’ employees to recognize and combat cybersecurity risks such as phishing scams. The company received its first $1 billion “unicorn” valuation in 2019, and two years later launched an initial public offering, pulling in $175 million in its first days of trading.
The company had 1,366 employees at the end of 2021, according to its most annual report, including 264 outside the United States. Last year it reported a net loss of $11.8 million.
The $4.2 billion deal represents the largest buyout figure involving a local public corporation since 2020, when Apollo Global Management paid $6 billion for Largo technology distribution company Tech Data. Last year, Tech Data merged with California company Synnex in an $8.3 billion deal that brought it back to the public market as TD Synnex, which is now Tampa Bay’s largest public company.
Vista Equity Partners was founded in 2000 and is one of the world’s largest technology investment firms, with holdings in dozens of companies. Over the summer, Vista and another firm closed a $16.5 billion buyout of cloud computing company Citrix Systems.
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KnowBe4 shares jumped by more than a quarter after the Nasdaq opened Monday, and sat at $22.17 by day’s end.