Software maker New Relic has agreed to be taken private by TPG and Francisco Partners in a $6.5 billion all-cash deal, the company said on Monday, sending its shares up 13.5%.
The private equity firms have offered New Relic shareholders $87 per share held, representing a premium of 17.5% to the stock’s closing price on Friday.
New Relic’s cloud-based software allows websites and mobile apps to monitor servers and databases, as well as to track user interactions, helping boost efficiency when firms are looking to stretch every dollar during the current economic uncertainty.
Its growth has slowed amid stiff competition from other Application Performance Monitoring (APM) providers such as Dynatrace and Datadog.
New Relic has been targeted by several activist hedge funds including Jana Partners, Engaged Capital and Eminence Capital. Last year, Jana won representation on the company’s board.
The deal is expected to close in late 2023 or early 2024.
The software firm, which was founded in 2008 and went public six years later, has a 45-day window to seek other acquisition proposals.
Reuters