Avalara, Inc. announced on Monday that it had agreed to be acquired by private equity company Vista Equity Partners in a deal that values the automation software platform at $8.4 billion including debt.
Private equity firms have recently increased business investment as valuations of companies in all sectors have fallen as a result of a sell-off sparked by high inflation and tightening monetary policy.
Even though total M&A struck a snag in the first half of the year, PE companies were the main forces behind international dealmaking.
Shares of Avalara fell nearly 4% in premarket trading in response to Vista’s offer of $93.50 per share, which indicates a 2% discount from the stock’s most recent closing.
However, the price marked a 27% premium over the stock’s closing price on July 6, when it had risen over 30% due to media reports of a potential takeover.
Avalara, which was established in 2004, operates a cloud-based platform that helps companies with tax compliance. Roku Inc., Zillow Group, and Pinterest are just a few of the companies that use the Seattle-based company.
The transaction, which is expected to finalize in the second half of 2022, was advised by Goldman Sachs & Co. for Avalara.
As of March 31, Vista, which specializes in investments in tech and commercial software companies, managed close to $96 billion in assets.