Qualtrics acquired by Silver Lake for $12.5bn

June 2023 | DEALFRONT | PRIVATE EQUITY & VENTURE CAPITAL

Financier Worldwide Magazine

June 2023 Issue

In a deal that makes it an independent private entity, experience management company Qualtrics has been acquired by global private equity firm Silver Lake in an all-cash transaction that values Qualtrics at approximately $12.5bn.

Under the terms of the definitive agreement, Qualtrics shareholders, including its principal shareholder German software giant SAP, will receive $18.15 per share in cash. Upon completion of the transaction, Qualtrics’s common stock will no longer be listed on any public market.

Silver Lake and its co-investors, together with co-investor CPP Investments, will acquire 100 percent of the outstanding shares Silver Lake does not already own, including the entirety of SAP’s majority ownership interest. Qualtrics will become an independent, privately held company positioned to drive category-defining innovation and efficient growth at scale on its path to becoming the next great enterprise cloud software platform.

“I couldn’t be more excited for this step in our journey,” said Ryan Smith, founder and executive chairman of Qualtrics. “Silver Lake’s belief in our vision and their amazing track record of helping founders and management teams speaks for itself. We look forward to working together and driving category-defining growth to build the next great enterprise cloud platform.”

The transaction is fully financed by equity commitments from Silver Lake and co-investors, together with $1.75bn in equity from CPP Investments and $1bn in debt.

The leader and creator of the experience management category, Qualtrics is a cloud-native software provider that helps organisations quickly identify and resolve points of friction across all digital and human touchpoints in their business, so they can retain their best customers and employees, protect their revenue, and drive profitability. The company operates out of 28 offices globally.

“Qualtrics is becoming central to how businesses make mission critical customer and employee decisions that increase revenue and operational efficiency,” said Zig Serafin, chief executive of Qualtrics. “With our artificial intelligence (AI)-powered platform and automated actions, we help companies deliver exceptional experiences and build deep relationships with their customers and employees at scale.”

Following completion of the transaction, Qualtrics will continue to be led by Mr Serafin, and the company will remain headquartered in Provo, Utah and Seattle, Washington.

“This is a landmark transaction for Silver Lake, reflecting our confidence in the Qualtrics team and their vision,” said Egon Durban, co-chief executive of Silver Lake. “As they shape and continue to grow the next great enterprise software platform, they are the kind of leaders we have been most excited to partner with over many years of technology investing.”

Qualtrics’s board of directors, as well as a Qualtrics committee of independent directors, have approved the transaction, which has also been approved by SAP in its capacity as the principal shareholder of Qualtrics. No other shareholder approval is required.

The transaction is expected to close in the second half of 2023, subject to the satisfaction of customary closing conditions, including the receipt of the requisite regulatory approvals.

Mr Serafin concluded: “We are incredibly excited to partner with the team at Silver Lake, who deeply understand our business and will help us continue to build a high performing company, invest in our innovation and expand our ecosystem to help our customers succeed.”

Fraser Tennant