Solera Holdings Inc, a provider of technology services to insurance companies, said it had agreed to be acquired by an affiliate of private-equity firm Vista Equity Partners for $3.74 billion in cash.
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According to Solera’s Chief Executive and Co-founder Tony Aquila, the deal will generate immediate attractive value for the firm’s shareholders. The purchase price represents a 13 percent premium to the company’s stock value.
Vista Equity Partners is nearing a deal to buy Solera Holdings Inc.
Investors in the deal include Broad Street Principal Investments, a Goldman Sachs Group affiliate, and an investment subsidiary of Koch Industries, the person said.
The special committee had advised the board of directors and all of them agreed that the deal will benefit the company and are advising other stockholders to vote in favor of the merger.
The announcement comes less than a month after Solera Holdings announced in late August that it was exploring a range of strategic alternatives. The company hired Rothschild as its financial adviser while its board of directors’ special committee hired adviser Centerview Partners LLC and the law firm Sullivan & Cromwell.
The deal will be closed no later than Q1 2016 pending regulatory approval. Its brands include Audatex, CarweB, and AUTOonline, serving auto insurance companies, collision-repair facilities and independent assessors.
Jeffrey added that the lag in the rollout of Solera’s mobile products, coupled with interim organic revenue and margin challenges for earnings before interest, taxes, depreciation and amortization, would likely have made Solera Holdings a continued underperformer in the information services market.
The transaction would be expected to enhance the position of Vista, as an acquirer of data companies and enterprise application software. The company went public in 2007 after paying $1 billion for Automatic Data Processing Inc.’s (ADP) claims services unit the year before.
In 2014 the New York Times ran a piece on Vista suggesting that the firm’s acquisitions “release more reliable software more frequently, customer satisfaction rises and profitability improves”.
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According to Solera the deal is set to close no later than in first quarter of 2016.
