Adam Putz September 01, 2016
Thoma Bravo is negotiating a pair of deals that could together top $10 billion in value, according to Reuters. The first potential target is the software division of Hewlett Packard Enterprise (NYSE: HPE), which Thoma Bravo is reportedly in talks to acquire for between $8 billion and $10 billion. The second is Infoblox (NYSE: BLOX), a network security company that the firm could take private for somewhere around $1.2 billion. Let's take a look at the two possible deals one at a time.
The HPE software division includes Big Data platform Vertica, cybersecurity provider ArcSight and other products for IT operations management. Reuters reports that the assets in question earned $3.6 billion last year, down from the $3.9 billion generated in 2014. HPE is considering a sale of the division in an effort to streamline operations, and Thoma Bravo has reportedly made the best offer to date among a field of bidders believed to include Vista Equity Partners, The Carlyle Group and TPG. One potential differentiating factor for Thoma Bravo: the firm's strong current portfolio of software companies such as Compuware and Qlik Technologies, which could provide some cost-saving synergies in a potential deal with HPE.
The same could be said of Infoblox, a provider of software and security for networks. The company is seeking a sale after activist hedge fund Starboard Value revealed in April a 7% ownership stake in Infoblox, calling the shares "undervalued and represent[ing] an attractive investment opportunity." Earlier this year, Starboard was one of the driving forces behind the sale of Yahoo's core business to Verizon. Thoma Bravo approached Infoblox a few months ago and is now negotiating a possible purchase, according to Reuters, but no deal is considered imminent. Still, trading of Infoblox stock stopped shortly after the Reuters report broke Thursday at a per-share price of $22.14, a 3.2% uptick from the close of trading Wednesday.
If Thoma Bravo does take Infoblox private, it would continue this year's trend of tech companies leaving the public markets via take-private buyouts.