M&A Watch: 10 Recent Solution Provider Deals
Buyers Market
Consolidation continues within the industry as companies make strategic buys to pad their portfolios with expanded service offerings in a bid to remain relevant in a changing competitive landscape. One-dimensional companies are no longer sought after by clients pushing more and more companies to offer a range of services that can generate multiple streams of business beyond a single transaction.
This latest roundup of deals to hit the market is a mix of both strategic buying on the part of other companies along with a few private equity plays.
Take a peek at the latest transactions.
Kofax Buys Softpro
Kofax's purchase of Softpro brings electronic signature and fraud detection software and services into the Irvine, Calif.-based company's fold.
The deal, which includes an all-cash consideration of $34.7 million, along with up to $3.5 million in three additional payments pending certain conditions, further expands Kofax's reach in the document capture space. It also adds Softpro's client base of banks, retailers and government agencies throughout the world to Kofax.
The deal is expected to close by the end of the year, according to the company.
Heartland Payment Acquires TouchNet
Princeton, N.J.-based Heartland Payment Systems said Sept. 4 it officially closed on its $375 million buy of TouchNet Information Systems.
Heartland is a payment-processing company that provides credit, debit or prepaid card processing; mobile; e-commerce; and security, among other solutions, to the more than 275,000 merchants with which it works.
Lenexa, Kan.-based TouchNet, which also operates in the commerce solutions space, brings expertise in the higher-education field and is now part of Heartland's Campus Solutions division. TouchNet counted more than 600 customers in the higher-education sector at the time of the deal's close.
Genesys Adds CanaPlus
Daly City, Calif.-based Genesys is a company to watch.
Genesys, which sells technology -- cloud-based and on-premises -- to help companies on the contact center and customer service end, has been on a buying spree since 2012 when its ownership traded hands from Alcatel-Lucent to private equity firm Permira and venture capital firm Technology Crossover Ventures in a $1.5 billion deal.
Genesys' purchase, on undisclosed terms, for Singapore-based systems integrator CanaPlus Consulting, is its 10th purchase since getting new owners.
The CanaPlus deal supports the uptick in business for Genesys in the Asia-Pacific region and brings it greater regional reach in places such as Malaysia, Indonesia, Thailand and the Philippines.
Best Doctors Purchases Rise Health
Boston health-care solutions provider Best Doctors sought Chicago health management company Rise Health to help it grow its Software-as-a-Service revenue via Rise's Ascend Enterprise Platform, among its other products.
Best Doctors provides a database that promises access to the top 5 percent of doctors. Those resources are then made available to consumers through their employers or insurers.
The cloud-based Ascend database pulls in clinical, claims and consumer data into one place, which is expected to provide additional analytics capabilities to the Best Doctors offering.
Terms of the acquisition were not disclosed.
BeyondTrust To Private Equity
Cybersecurity software company BeyondTrust is expected to trade hands from one private equity firm to another once the deal closes.
New York private equity firm Veritas Capital is expected to buy the company for a reported $310 million from private equity and venture capital firm Insight Venture Partners, also of New York.
Veritas sees only increased demand moving forward for BeyondTrust's software, which is used by the enterprise and government entities.
"We believe that the acquisition of BeyondTrust represents the opportunity to create a leading cybersecurity software platform," Veritas Capital Partner Hugh Evans said in a statement. "We expect the cybersecurity market to benefit from increasing regulatory/compliance requirements."
Seagate Closes On LSI Flash Business
Seagate Technology completed its buy of LSI's flash business.
The Cupertino, Calif.-based company bought LSI's Accelerated Solutions and Flash Components divisions from Avago Technologies, with headquarters in San Jose, Calif., and Singapore, in a $450 million cash deal.
"There is a growing opportunity for mobile and enterprise flash-based storage solutions, which is why we're excited about this strategic technology acquisition," Seagate Chair and CEO Steve Luczo said in a statement. "Integrating LSI's Enterprise PCle flash and SSD controller products, and its engineering capabilities, into Seagate's leading storage technology portfolio and product development will expand our ability to meet a broader base of customers' needs and drive new revenue opportunities."
Tyler Technologies Buys SoftCode
Tyler Technologies' purchase, on undisclosed terms, of Marlborough, Mass.-based civil process software company SoftCode is expected to help beef up the companies' courts and justice solutions.
Tyler Technologies, based out of Plano, Texas, works with local governments to provide management software solutions -- including appraisal and tax, ERP, and records and documents -- to the public sector.
SoftCode is expected to join Tyler Technologies' Courts & Justice business.
Blackbaud Inks Deal For MicroEdge
Nonprofit software and services provider Blackbaud is set to buy MicroEdge for $160 million.
New York-based MicroEdge sells software aimed at philanthropic organizations looking for assistance with things like grant-making or foundation management. The purchase is expected to expand the solutions to the philanthropy sector for Charleston, S.C.-based Blackbaud.
The deal is expected to close in the fourth quarter.
MegaPath Wholesale Biz To Pivotal
Phoenix-based private equity firm Pivotal Group's Global Capacity Connectivity-as-a-Service company is set to get larger once its deal to purchase the wholesale business of MegaPath closes.
MegaPath, headquartered in Pleasanton, Calif., offers connectivity services, such as data, voice, security and hosted IT, which are aimed at SMBs and the enterprise. It's selling, on undisclosed terms, its wholesale business and national colocation aggregation network to Pivotal.
Meanwhile, MegaPath will focus on growing its managed services and cloud businesses.
The purchase is expected to be completed by the end of the year.
Thoma Bravo's Recent Plays
Thoma Bravo, a private equity firm with offices in Chicago and San Francisco, ramped up its investment strategy in September.
The investment firm said it completed its purchase, on undisclosed terms, of Austin, Texas-based identity management and compliance software company SailPoint.
Thoma Bravo's investment strategy focuses on companies in the application and infrastructure software or technology-enabled services sectors.
The SailPoint close comes on the heels of news Thoma Bravo intends to buy Detroit-based software developer Compuware for $2.5 billion in a deal expected to close by early next year.