The all-cash transaction will be funded by an equity consortium led by Insight Partners, with significant investment from TPG Capital and Temasek, and participation from notable investors including Sixth Street.
Under the terms of the agreement, Datto stockholders will receive $35.50 per share in a transaction that values Datto at approximately $6.2 billion. The offer represents a 52% premium to Datto’s unaffected stock price of $23.37 as of March 16, 2022. This deal also represents a 48% premium to the unaffected 30-day volume-weighted average price of Datto stock for the period ending March 16, 2022.
“This is exciting news for Kaseya’s global customers, who can expect to see more functional, innovative and integrated solutions as a result of the purchase,” said Fred Voccola, Kaseya’s CEO. “Datto has a legendary commitment to its customers and employees. The alignment of our missions and focus makes us a natural fit, that will help our greatly appreciated customers reach new levels of success.” Continued Voccola, “Kaseya is known for our outstanding track record of retaining the brands and cultures of the companies we acquire and supercharging product quality. We couldn’t be more excited about what lies before us – Kaseya and Datto will be better together to serve our customers.”
“Datto has always been committed to creating world-class technology for SMBs and delivering it through our global network of MSPs to align our growth with the channel. Combining with Kaseya brings together a broader array of technology products to create additional opportunities for MSPs,” said Tim Weller, CEO of Datto. ”I’m encouraged by the continued investment in the rapidly-expanding global MSP community, and this transaction is another important validation of the channel.”
“At Insight Partners, we work with IT infrastructure technology leaders who define and grow their markets through world-class software, data and innovation,” said Michael Triplett, Managing Director at Insight Partners. “We are excited to continue to support Kaseya, an industry-defining IT and security infrastructure management company, as they deepen their support for the industry and enhance the experience of their customers.”
Approvals and timing
The transaction, which is currently expected to close in the second half of 2022, is subject to the satisfaction of customary closing conditions, including the receipt of applicable regulatory approvals. In addition to unanimous board approval, shareholders holding in aggregate approximately 70% of the issued and outstanding shares of common stock of Datto have approved the transaction by written consent.
No further action by other Datto shareholders is required to approve the transaction. Upon completion of the transaction, Datto’s common stock will no longer be listed on the New York Stock Exchange.
The companies will operate completely independently until the transaction has been finalized.
Evercore acted as financial advisor to Kaseya and Willkie Farr & Gallagher LLP acted as Kaseya’s legal advisor. Qatalyst Partners acted as financial advisors to Datto and Kirkland & Ellis LLP acted as Datto’s legal advisor.
Financing for the transaction is being provided by Golub Capital, Blackstone Credit, Ares Management Credit Funds, Owl Rock Capital, Oak Hill Advisors, and Carlyle Global Credit. Paul, Weiss, Rifkind, Wharton & Garrison LLP acted as financing legal advisors to Kaseya. Davis Polk & Wardwell LLP acted as legal advisors to the financing sources. Ropes & Gray LLP acted as TPG’s and Sixth Street’s legal advisor. Sullivan & Cromwell LLP acted as Temasek’s legal advisor.