Crosspoint Capital to Buy Absolute Software program for $657M

Crosspoint Capital Companions has joined Thoma Bravo and others within the take-private cybersecurity spree, agreeing to purchase endpoint safety vendor Absolute Software program for $657 million.

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The Vancouver, British Columbia-based firm mentioned the $11.50-per-share provide from the Silicon Valley-based non-public fairness agency will enable Absolute Software program to develop from its heritage in asset visibility and management to handle endpoint resilience and entry. Crosspoint’s provide represents a 34% premium to Absolute’s Wednesday closing worth, which was the final day earlier than the transaction was introduced.

“For the previous 5 years, our focus has been on creating the business’s solely really self-healing safety platform centered on resilience,” mentioned Absolute President and CEO Christy Wyatt.” “By partnering with Crosspoint, a confirmed cybersecurity investor with a observe report in constructing progress firms, we’re delivering quick money worth to our shareholders, whereas positioning Absolute for an thrilling future.”

Absolute’s inventory has jumped $2.78 – or 32.4% – to $11.36 per share because the deal was introduced earlier than the market opened Thursday. That is the very best the corporate’s inventory has traded since Feb. 14. The deal comes a month after Absolute laid off 40 staff – or 5% of its workforce – to chop working bills and shrink its workplace house footprint. The acquisition is valued at $870 million inclusive of Absolute’s debt.

The acquisition has been unanimously accepted by Absolute’s board and is predicted to shut within the second half of 2023. The Crosspoint Capital transaction values Absolute at 17.5% greater than when the corporate first went public 31 months in the past. Absolute raised $60 million on a market cap of $559 million in the course of the firm’s October 2020 Nasdaq preliminary public providing (see: The State of Endpoint Resilience: Enchancment Required).

“Within the trendy distant and hybrid work atmosphere, sustaining machine integrity and safety is harder than ever,” mentioned Crosspoint Managing Associate Greg Clark. “We’re impressed with how Absolute has constructed upon its asset visibility and management heritage and expanded into options that present endpoint resilience and the dependable entry wanted in at this time’s hybrid work environments.”

Neither Absolute nor Crosspoint instantly responded to an Data Safety Media Group requests for extra remark.

Gross sales, Losses Mount for Absolute

Absolute’s income climbed to $110.8 million in the course of the six months ended Dec. 31, 2022, up 19.4% from $92.8 million a yr earlier. On the similar time, nevertheless, the corporate’s web loss elevated to $16.5 million, 29.9% worse than a web lack of $12.7 million the yr prior.

“This transaction with Crosspoint validates the engaging enterprise and progress profile established by Christy and her group and delivers a strong return to shareholders,” Absolute Chairman Dan Ryan mentioned in an announcement. “By partnering with a confirmed non-public software program investor, Absolute can be in a stronger place each strategically and with respect to its capital construction to attain its progress potential.”

Absolute has made one acquisition since going public, scooping up safe entry service edge supplier NetMotion for $340 million in July 2021 to ship a digital non-public community, zero belief community entry and digital expertise monitoring to clients. Absolute’s expertise has flown underneath the radar as of late and hasn’t appeared in any latest Gartner Magic Quadrants, Forrester Waves or IDC MarketScapes.

Absolute Joins Forescout, ExtraHop in Crosspoint’s Portfolio

Crosspoint has up till now teamed up with different traders when buying a stake in cybersecurity firms. The corporate joined forces with Introduction Worldwide in August 2020 to buy Forescout for $1.4 billion, teamed up with Bain Capital in July 2021 to purchase ExtraHop for $900 million, and is a part of a consortium led by Introduction and Permira that acquired McAfee for $14 billion in March 2022.

Additionally in March 2022, Crosspoint purchased RSA Safety’s curiosity within the RSA Convention and stored Clearlake Capital and Symphony Expertise Group as traders. Within the startup world, Crosspoint led a follow-on Sequence A for Cyware in January 2021, a $56 million Sequence B for ReversingLabs in August 2021 and a $50 million Sequence C for Afero in December 2021. Absolute is Crosspoint’s first deal as the only acquirer.

Non-public fairness companies have capitalized on the financial downturn to amass publicly traded cybersecurity distributors at a steep low cost. No agency has capitalized on the nice offers greater than Thoma Bravo, which in 2022 agreed to spend $12 billion on three id safety goliaths: SailPoint, Ping Identification and ForgeRock. Thoma Bravo additionally talked with Darktrace however could not agree on phrases (see: Why Thoma Bravo Plans to Triple Down on Identification Safety).

Vista Fairness Companions and Francisco Companions even have gotten in on the take-private motion, with the previous buying safety consciousness coaching vendor KnowBe4 in February at a $4.6 billion valuation. And on Friday, Francisco Companions accomplished its $1.7 billion acquisition of knowledge analytics vendor Sumo Logic, which had first been introduced in February.