Street Talk First Look

Tuesday

April 16, 2024

Street Talk

First Look

Good evening,

US private equity giant Vista Equity Partners is getting busy Down Under.

Street Talk understands the $US101 billion ($157 billion) global investment firm has approached Australian software-as-a-service company CriticalArc, seeking to buy the outfit for up to $US37.5 million ($58.4 million).

CriticalArc is based in Sydney but has offices in the UK and North America. Its flagship product, SafeZone, helps large organisations handle incident management and risk mitigation across multiple sites.

Sources close to the target said Vista had pitched CriticalArc’s owners with an all-cash offer for 100 per cent of the equity based on an enterprise valuation range of $US35 million to $US37.5 million.

Management was welcomed to roll over or reinvest a portion of their equity proceeds into the new entity post-acquisition. Vista is understood to be working closely with Kirkland & Ellis on legals and Ernst & Young for financials. Sources said the bidder has secured internal investment committee support and could get a bid done within weeks.

Street Talk asked Vista if the offer, made in February, is still afoot. We received a “no comment”, both on CriticalArc and fundraising for the Flagship Fund VIII (more on this later). CriticalArc did not respond in time for publication.

Separately, Street Talk understands Vista is seeking to raise local money for its Flagship Fund VIII – a strategy that’s targeting 18 to 25 high-quality SaaS businesses, primarily in North America, with enterprise valuations between $US750 million and $US10 billion-plus.

As such, it’s launched an Australian unit trust feeder fund – its first time ever – via ROC Partners and a Cayman Island Beta Fund via Morgan Stanley Asia. Both structures have completed a first close and are looking to close things out in May.

Read the full story tomorrow and more on the Street Talk page.