Thoma Bravo Sees Potential in Identity Security Company

Private equity firm Thoma Bravo announced that it intends to acquire identity security company SailPoint – a company with adequate numbers but a great deal of promise – for $6.9 billion.

SailPoint, an Austin, Texas-based identity management and security tech company, was founded in 2005 and was taken public in 2017 by Thoma Bravo. Their Q4 2021 revenue was $135.6 million, up 31% year-over-year (YOY), and their total revenue was $439 million, up 20% over the year before. These are the kind of numbers private equity loves to see, as it shows a great deal of potential, said Seth Boro, Managing Partner at Thoma Bravo. SailPoint's market will increase as more employees work from home, and companies need a way to ensure perpetual identity security continually, Boro said. SailPoint will also be able to utilize Thoma Bravo's sector expertise, said Mark McClain, Chief Executive Officer and Founder of SailPoint, and use the partnership to accelerate their emergent presence in the identity security market.

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"We've seen a tremendous opportunity ahead of us to continue to set the pace as a category leader," said McClain in a joint release with Thoma Bravo. "This transaction delivers significant immediate cash value to our stockholders and will allow us to pursue our long-term growth trajectory with greater flexibility and effectiveness."

The $6.9 billion deal is an all-cash transaction, and upon completion, SailPoint would become a privately-held company. SailPoint's board approved the deal, but their shareholders, who will receive $65.25 per share (representing a 48% premium on SailPoint's 90-day volume-weighted average price), have yet to approve it. A go-shop provision allows SailPoint to look for a better deal from another buyer, but the condition expires May 16. However, if the deal with Thoma Bravo goes through, the transaction should close in the middle of the second quarter.