- Darktrace has received an offer from US private equity firm Thoma Bravo
- Chicago-based Thoma Bravo has investments in dozens of software developers
Darktrace could be the latest high-profile name to leave the London Stock Exchange after accepting a $5bn (£4.3bn) takeover bid from a US private equity firm.
The cybersecurity company agreed to terms with Thoma Bravo, which tried to take over Darktrace two years ago until talks collapsed.
Thoma Bravo is now offering £6.20 per share, 20 per cent higher than Darktrace’s closing price on Thursday and a 44.3 per cent premium to the average share price over the past three months.
Takeover bid: Cybersecurity company Darktrace received an offer from US private equity firm Thoma Bravo, which attempted to take over Darktrace two years ago.
It considers that the acquisition represents an “attractive opportunity” to boost its presence in the cybersecurity sector, accelerate the group’s growth and boost the development of artificial intelligence products.
The Chicago-based firm already has investments in dozens of software developers, such as British company Sophos, a security software seller it bought for £3 billion four years ago.
If it buys Darktrace, the acquisition will deal another blow to London’s shrinking public markets, which have lost multiple high-profile companies to foreign buyers in recent years.
Well-known acquisitions in recent years include G4S, Hotel Chocolat, Dechra Pharmaceuticals, supermarket chain Morrisons and fashion brand Ted Baker.
UK-listed companies are seen as easy takeover targets due to their perceived undervaluation compared to their global rival peers and the depreciation of the pound since the Brexit referendum.
Darktrace told investors on Friday that the group’s financial and operational achievements have not been “proportionately reflected” in its valuation.
Gordon Hurst, chairman of Darktrace, said: “The offer represents an attractive premium and an opportunity for shareholders to receive the certainty of cash consideration at a fair value for their shares.”
Darktrace Actions jumped 17.5 per cent to 607.4 pence early on Friday afternoon following the deal’s announcement, more than double its IPO price of 250 pence.
Its share price has suffered significant turbulence since its listing in April 2021, initially rising to more than £10 before plunging after broker Peel Hunt alleged Darktrace was significantly overvalued.
The company was later attacked by short sellers ShadowFall and Quintessential Capital Management, with the latter accusing it of questionable accounting practices.
An independent investigation by auditor EY highlighted “a number of areas” where Darktrace could make improvements, but said none of the company’s previous financial statements required correction.
Cambridge-based Darktrace uses artificial intelligence in software to protect organizations against cyber threats such as ransomware, email phishing and software-as-a-service attacks.
Its clients include Royal Mint, satellite operator OneWeb, cruise giant Royal Caribbean and power generation provider Drax Group.
Businessman Mike Lynch, who is on trial in San Francisco accused of fraud at Autonomy, a company he sold to HP in 2011, was an early backer of Darktrace.
Lynch, who has pleaded not guilty to 16 charges of conspiracy and wire fraud, and his wife will stand to gain around £300m if Thoma Bravo buys Darktrace.
Dan Ridsdale, chief technology officer at Edison Group, said: “The [takeover] The deal is undoubtedly a blow to the UK stock market, which is losing one of its few structural growth tech companies of significant scale.
“Ultimately, a market that is underweight in structural growth will underperform those in which it is well represented, and that is what we have seen in the UK over the last few years.”