Accel-KKR Has Merger Agreement with SumTotal
The bid must sting for Vista Equity Partners, the PE shop that is the target’s biggest shareholder, that planned a buyout at a lesser price.
April 24, 2009
SumTotal Systems has agreed to buyout with affiliates of Accel-KKR, a technology focused private equity firm, valuing it at about $3.80 per share, or $124 million.
Accel-KKR outbid Vista Equity Partners, which earlier this month announced its plans to buy SumTotal.
Vista Equity Partners pitched an all-cash buyout offer to SumTotal Systems. The deal Vista offered SumTotal equaled about $3.25 per share, or $103 million. Vista, owner of 13% of SumTotal shares, is its largest stockholder.
In Friday trading, shares already were trading for more than Accel-KKR’s bid, at $3.84 each; the stock was up more than 22 percent.
Like Vista’s bid, Accel-KKR’s offer is all-cash. SumTotal still has 30 days to consider other offers, according to a provision in its deal.
An analyst report from JMP Securities, even before the Accel-KKR deal was revealed, pegged SumTotal's value at $5 per share. After the deal was announced, JMP affirmed this target value in another report.
"SumTotal may be using this time to hunt for another bidder or to perhaps resuscitate a previous interest," it stated.
RBC Capital Markets is acting as financial advisor to SumTotal, and Wilson Sonsini Goodrich & Rosati is acting as SumTotal’s legal advisor. Kirkland & Ellis LLP is acting as legal advisor to Accel-KKR.
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