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Informatica Going Private In $5.3 Billion Deal

A private equity firm and a Canadian pension fund are paying $48.75 per share to acquire the leading data integration software developer.

Data integration software developer and services provider Informatica Corp. is being taken private in a $5.3 billion deal, the company said Tuesday.

Permira, an international private equity firm, and the Canada Pension Plan Investment Board are acquiring Informatica for $48.75 per share. Monday, before the deal was announced, the company's stock closed at $45.83 per share.

Informatica reported revenue of $1.05 billion for its fiscal 2014 ended Dec. 31, up more than 10 percent from $948.2 million in fiscal 2013. Net income for the year grew more than 32 percent to $114.1 million.

[Related: Big Data Boost: Open Data Platform Initiative Unites 15 Tech Giants]

Informatica, founded in 1993, was a pioneer in the data integration arena and in many respects was Silicon Valley's original "big data" company.

Based in Redwood City, Calif., the company has long been one of the pre-eminent developers of data integration software, including ETL (extract, transform and load) tools for moving data among databases and data warehouse systems. The vendor also offers software for master data management, data quality management, data replication and other tasks. It began offering its applications as cloud services in 2006.

But the data integration technology market has become increasingly competitive in recent years with established companies like Oracle and IBM, and startups like Tamr, Bedrock Data and Mortar Data offering competing products. Talend, also based in Redwood City, provides open-source data integration software and just launched cloud versions of its applications.


"After careful consideration and deliberation of strategic alternatives, our board of directors unanimously concluded that the sale of Informatica to the Permira funds and CPPIB is in the best interest of all Informatica stakeholders," said CEO Sohaib Abbasi in a statement. "While delivering immediate compelling value to our shareholders, we remain committed to the long-term success of our customers, partners, and employees. Permira and CPPIB share both our vision for Informatica to power the data-ready enterprise and our conviction in sustained long-term growth."

In an interview with CRN in late 2013, Abbasi said the industry trends of big data, cloud computing and the Internet-of-Things were driving increased demand for Informatica's technology.

At the time the CEO said the channel directly accounted for about 25 percent of the company's sales with a roughly equal amount of sales influenced by systems integrators and solution providers. Partners included Knowledgent Group, AmberLeaf Partners, Intricity and SSG.

Informatica's board has approved the acquisition agreement and recommended that shareholders accept the deal. The company expects to complete the transaction in either the second or third quarter of this year, subject to shareholder approval, regulatory approvals and other closing conditions.

PUBLISHED MARCH 9, 2015

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