Squarespace to take private in $7 billion private equity deal | Wilnesh News

square spaceThe website building platform announced on Monday that it will Privatization After nearly three years of turmoil in public markets, the company struck a $6.9 billion all-cash deal with private equity firm Permira.

Permira agreed to pay $44 per share in cash, a premium of about 30% to Squarespace’s unaffected share price. Squarespace has struggled to gain public market support in recent years: it opened below the $50 reference price in 2021 and has never traded above its $48 opening price since.

“We are excited to partner with Permira on this new journey,” Squarespace founder and CEO Anthony Casalena said in a press release. Casalena and current investors Accel and General Atlantic control 90% of Squarespace’s voting shares. All three have approved the deal and will remain investors after the Permira deal closes.

Squarespace competes with Wix and Shopify for a share of the website building and e-commerce market. Shares rose nearly 13% to $43 a share in premarket trading. Permira will fund the transaction with the help of Ares Capital, black stone and blue owl.

“We are excited to partner with Anthony and his team to support the company in reaching its full potential,” Permira partner David Erlong said in a release.

Squarespace’s move to go private marks a trend among smaller tech companies over the past two years, some of which have been decimated in the public markets or believe they can create more value by merging with other private equity portfolio companies. For example, Qualtrics was spun off from SAP in 2021 and was quickly taken private again in 2023 by the Canada Pension Plan and Silver Lake in a $12.5 billion deal.

After years of speculation and turmoil, including continued contact with activist investor Elliott, Japanese giant Toshiba also went private in 2023 in a $13.6 billion deal.

With markets quiet in 2022 and 2023 and many late-stage companies in IPO holding mode, investors are keeping a close eye on the deal space. There are signs that M&A activity is picking up again, with a number of late-stage companies already going public or planning to go public.

Centerview, JP Morgan, Skadden and Richards, Layton & Finger advised Squarespace and its special committee. Permira was advised by Goldman Sachs and Latham & Watkins.