Cloud-based marketing software company Marketo has been acquired by Vista Equity Partners, a private equity firm, for approximately $1.79bn (£1.23bn) in cash, chief executive Phil Fernandez said in a statement today (31 May).
The company has been publicly traded since 2013 and this marks a return to private ownership. According to CNBC, the $35.25 (£24.28) in cash per share represents a 64 per cent premium to the company’s 9 May closing price.
Vista Equity Partners will own 100 per cent of the company and the transaction is expected to close in the third quarter of this year.
"After careful consideration and deliberation, our Board of Directors unanimously concluded that the sale of Marketo to Vista Equity Partners was in the best interest of Marketo and its shareholders," said Fernandez.
"The acquisition will allow Marketo to continue to focus on customer success and to remain the independent category leader, continuing to set the agenda for product innovation and thought leadership for the entire digital marketing industry. It will also enable us to successfully deliver on the bold vision we recently set forth – to give tomorrow's marketers and the C-suite an ultra-high-scale enterprise platform for customer engagement.”
The San Mateo, California-based company recently announced large technology investments in a next-gen platform, dubbed 'Project Orion,' at its Marketing Nation Summit and recently brought on Shankar Venkataraman, formerly of IBM, as chief scientist. Venkataraman has been in the middle of the new platform’s development.
“There’s a lot of apple polishing on the technology side,” said Venkataraman, in a previous conversation with The Drum. “One of the reasons I left IBM to join Marketo is I wanted to be part of this.”
The company has seen revenues grow, but has been operating at a loss, according to its most recent quarterly report. It had forecast that trend to continue.
Vista, according to TechCrunch, has been aggressive in acquiring technology companies in the marketing space. It acquired Cvent, an event management company, for $1.65bn in April.
"Marketo is the clear leader in the marketing automation space and has consistently delivered innovative mission critical products to its more than 4,600 customers," said Brian Sheth, co-founder and president of Vista.
"Given our proven track record and focus on investing in high-growth SaaS platforms, we are thrilled to partner with Phil and the broader Marketo team to help the company accelerate innovation, growth, and excellence."