KnowBe4 To Go Private In $4.6B Vista Equity Partners Deal

Confirmation of the $4.6-billion planned acquisition of security training and phishing test specialist KnowBe4 by Vista Equity Partners comes just a few weeks after KnowBe4 disclosed discussions of $4-billion-plus acquisition by Vista.


Security awareness training provider KnowBe4 said Wednesday that it has entered into an agreement to be sold to private equity company Vista Equity Partners in an all-cash deal valuing the company at $4.6 billion.

News of the acquisition comes just a little over three weeks after Clearwater, Florida-based KnowBe4 said it had received a $4-billion-plus offer from Austin, Texas-based Vista Equity Partners.

KnowBe4 claims to be the world’s largest platform combining security awareness training with simulated phishing attacks, with over 52,000 customers working with it to combat security issues around social engineering. The company has over 1,600 employees.

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The company, which went public in March 2021, also provides tools for protecting against phishing attacks via emails, and offers businesses free training tools.

KnowBe4 in August reported its second fiscal quarter 2022 financials, with revenue up 36.0 percent to $80.8 million and net income of $4.4 million compared to a net loss the year before of $16.9 million.

Indirect channels have been key to the company’s growth. KnowBe4, in a regulatory filing in March, said it plans to increase its channel partnerships as a way to efficiently reach new territories and opportunities.

“Growing our international channel partnerships will help us reach new jurisdictions where we have not yet developed extensive brand awareness and local customer relationships. We believe managed service providers or MSPs, and channel partners represent an efficient way to sell to smaller customers, as organizations with limited or no IT departments often rely on MSPs to provide specialized security skills or knowledge. As our business becomes more mature, we believe the revenue contribution from channel partners and MSPs will continue to increase,” the company wrote.

Vista Equity Partners plans to pay $24.90 per share in cash once the deal is closed, which it is slated to do in the first half of 2023, subject to regulatory approvals and approval by KnowBe4’s shareholders. That price is a 44-percent premium over KnowBe4’s share price on September 16 when news of the acquisition was first unveiled.

Once the deal closes, KnowBe4 will step away from the Nasdaq Global Select Market and become a private company.

KnowBe4 also disclosed that, after the original acquisition proposal was unveiled, it evaluated transaction alternatives without specifying who else may have expressed interest in acquiring the company.

In response to a CRN request for further information, KnowBe4 said via email that the company for now is not providing any further information on the deal.

However, KnowBe4 CEO Stu Sjouwerman said in a prepared statement that the acquisition represents the next phase of the company’s journey.

“KnowBe4 has a strong record of performance, as evidenced by our market-leading platform and global customer base. Under Vista’s ownership, we will have access to additional resources and support, which will help us achieve our goals and deliver enhanced value to our customers. We look forward to partnering with Vista’s team to continue empowering businesses worldwide to strengthen their human firewall and make smarter security decisions every day,” Sjouwerman said.

KnowBe4’s stock was up nearly 13 percent Wednesday to $24.30 after the deal was announced. The company’s total market cap stood at $4.27 billion.