Abu Dhabi part of $10.2bn deal to take US software giant private By Reuters June 27, 2022 Creative Commons Zendesk shares were up 27.9 percent at $74.10 late on Friday morning on the New York Stock Exchange Zendesk agreed to be taken private by investment firms$10.2 billion deal led by Hellman & Friedman and PermiraComes just weeks after the company concluded it would remain publicUnit of Abu Dhabi Investment Authority also joined the consortium Zendesk Inc on Friday agreed to be taken private by investment firms led by Hellman & Friedman and Permira in a $10.2 billion deal, a turn of events that comes just weeks after the company concluded it would remain public. The San Francisco-based software company said shareholders will receive $77.50 per share in cash, representing a premium of 33.7 percent to the stock’s last closing price. Still, it marked a deep discount compared with a prior offer that valued the firm at up to $16 billion in February. Zendesk said the offer from Hellman & Friedman emerged after the termination of its formal process. A subsidiary of the Abu Dhabi Investment Authority (ADIA) and Singapore’s sovereign wealth fund GIC also joined the investor consortium. Hellman & Friedman and Permira said they have arranged for debt and equity financing commitments. The deal marked a win for activist investor Jana Partners, which has a stake of nearly 2.5 percent in the software firm. Jana has been pushing the company to sell itself after it failed to buy SurveyMonkey parent Momentive Global Inc in a $3.9 billion deal. The Momentive deal fell through after it was rejected by Zendesk shareholders. In February, Zendesk received an unsolicited bid of $127-$132 per share in cash from private equity firms. It rejected the offer, but did not name the bidders. By agreeing to the latest offer from Hellman & Friedman, Zendesk avoids losing board seats in a proxy fight with Jana at the company’s annual meeting scheduled for August. “If this is the end for it as a public entity, I think most would see it as a very disappointing ending,” Craig-Hallum analyst Jeff Van Rhee said. “We’ve long felt this is a premium company, premium product, a lot of runway for long-term growth.” The equity value of the deal that is expected to close in the fourth quarter is $9.5 billion based on 122.54 million outstanding shares, according to Refinitiv data. Zendesk shares were up 27.9 percent at $74.10 late on Friday morning on the New York Stock Exchange.
