LONDON: Thoma Bravo L.P. through Luke Bidco Limited has agreed to acquire entire issued, and to be issued, ordinary share capital of Darktrace Plc. The acquisition will be implemented by way of a Court-sanctioned scheme of arrangement.

Under the terms of the acquisition, each Darktrace shareholder will be entitled to receive: $7.75 in cash/share. The GBP equivalent value of the acquisition price per Darktrace Share based on the Announcement Exchange Rate, being 620 pence, represents a premium of approximately 44.3 per cent. to the volume-weighted average price of 429.9 pence per Darktrace Share for the three-month period ended 25 April 2024.

The acquisition values Darktrace’s entire issued, and to be issued, ordinary share capital at approximately $5.315 billion on a fully diluted basis and implies an enterprise value of approximately $4.992 billion and a multiple of approximately 34 times Darktrace’s Adjusted EBITDA for the twelve months ended 31 December 2023 of $146 million.

Andrew Almeida, Partner of Thoma Bravo, said: “Darktrace is at the very cutting edge of cybersecurity technology, and we have long been admirers of its platform and capability in artificial intelligence.

The pace of innovation in cybersecurity is accelerating in response to cyber threats that are simultaneously complex, global and sophisticated. Darktrace is driven by a culture of innovation and we are excited by the opportunity to work alongside Darktrace’s team and accelerate its development into a scaled, global leader, further strengthening its capability and offer to customers.

Thoma Bravo has been investing exclusively in software for over twenty years and we will bring to bear the full range of our platform, operational expertise and deep experience of cybersecurity in supporting Darktrace’s growth.”

Thoma Bravo, L.P. firmly believes that the Acquisition will benefit Darktrace, Darktrace’s customers and the wider technology ecosystem through supporting the development of enhanced products and Darktrace’s cybersecurity capability.

Bidco has agreed with Darktrace under the terms of the Cooperation Agreement that Thoma Bravo will, with Darktrace’s support and involvement, engage proactively and collaboratively with the competent regulatory authorities and government stakeholders, recognising the specific importance of Darktrace’s contribution to the technology ecosystem.

The Darktrace Directors, who have been so advised by Jefferies and Qatalyst Partners as to the financial terms of the Acquisition, consider the terms of the Acquisition to be fair and reasonable. In providing their advice, Jefferies and Qatalyst Partners have taken into account the commercial assessments of the Darktrace Directors.

Jefferies and Qatalyst Partners are providing independent financial advice to the Darktrace Directors for the purposes of Rule 3 of the Takeover Code.

Thoma Bravo believes that the acquisition of Darktrace represents an attractive opportunity to increase its exposure to the large and growing cybersecurity market, and to invest to accelerate Darktrace’s continued development and further scale the business globally.

Darktrace Plc is a global leader in cybersecurity artificial intelligence. Thoma Bravo recognises that Darktrace is a pioneer in using self-learning artificial intelligence to neutralise cyber threats and automate responses to cyber incidents, leveraging its long-standing research and development expertise. Rather than study historic attacks, Darktrace’s technology continuously learns and updates its knowledge of an organisation’s business data and applies that understanding to help transform security operations to a state of proactive cyber resilience.

As a result, Darktrace has become a leader in cybersecurity artificial intelligence now providing a full lifecycle approach to cybersecurity enabling its 9,400 customers to identify, stop and respond to all known and unknown threats, across all aspects of an organisation’s cybersecurity tools.

Thoma Bravo recognises the strength of Darktrace’s ActiveAI Security Platform, the expertise of its Cambridge-based technology team, the track record of its experienced management team, and the compelling nature of its resilient financial model.

The cybersecurity market is evolving at pace and the volume and sophistication of cyber threats and attacks faced is rapidly increasing. However, the market remains fragmented, with few truly global players. Serving the world’s largest customers and enterprises requires Darktrace to continually make significant technology investments and further scale globally, to ensure that its platform can stay ahead of changing cyber threats.

Thoma Bravo believes that private ownership can facilitate its development. Thoma Bravo has a long track record of providing capital and strategic support to experienced management teams, growing software and technology companies, and creating highly skilled jobs. A partnership with Thoma Bravo would give Darktrace a unique opportunity to accelerate Darktrace’s growth and the development of AI augmented cyber solutions for its customers and grow over time.

Commenting on this announcement, Poppy Gustafsson OBE, the CEO of Darktrace Plc, said: “I am immensely proud of our brilliant business and people. From our base in Cambridge, we are building a world-leading company using a unique form of artificial intelligence to address the societal challenge of cybersecurity.

This proposed offer represents the next stage in our growth journey and I am excited by the many opportunities we have ahead of us. Our technology has never been more relevant in a world increasingly threatened by AI-powered cyberattacks. In the face of this, we are expanding our product portfolio, entering new markets, and focused on delivering for our customers, partners and colleagues.”

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