KKR Announces BMC Software Acquisition

June 1, 2018

Financial Information*

  • Transaction Value $8.3B

Transaction Facts

  • KKR & Co. (NYSE:KKR) announced this morning that it agreed to acquire BMC Software, officially acknowledging a transaction that had been speculated about and discussed over the last week.

  • This transaction, reported by Bloomberg to be valued at approximately $8.3 billion including debt, is below the $10 billion figure that had been rumored but represents the firm’s biggest acquisition since the 2008 financial crisis.

  • The transaction is expected to close in the third quarter of 2018.

Closing The Deal

 

Big Deal: Though this deal itself is no record, it illustrates a swing back to bigger leveraged buyouts across the board–fueled by a record $1 trillion in dry powder. KKR is expected to be both more aggressive and more willing to skew bigger in a larger strategic shift.

 

Spooling Up: This is the fourth $1 billion-plus technology acquisition by a buyout firm this year (following acquisitions of Mitel, VeriFone, and CommerceHub). This ties the number of such deals in all of the previous two years.

 

Seeing Runway: KKR is said to be looking to capitalize on potential go-to-market, as Bain and GGC were seen to be focused primarily on product and invested hundreds of millions of dollars in R&D and other improvement initiatives. This opens the company to organic growth–a healthy complement to the standard PE playbook of bolt-on acquisition.

 

*Financial information from news reports.

 

View this article and others like it on Smart Business Magazine's website

 

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