Smartsheet has agreed to be acquired and taken private by Blackstone and Vista Equity Partners in a significant deal that values the workplace management software company at approximately $8.4 billion. Under the terms of this acquisition, shareholders of Smartsheet are set to receive $56.50 per share in cash, representing a notable 41% premium compared to the company's weighted average price over the 90 trading days leading up to July 17, the last day prior to speculation surrounding a potential sale.
Following the announcement, shares of Smartsheet witnessed an uptick of 6.6% during midday trading. This transaction is subject to clearance from regulators and requires the approval of Smartsheet's investors, with an anticipated completion date in the company's fiscal fourth quarter ending January 31.
As part of the acquisition, Smartsheet's Chief Executive, Mark Mader, expressed optimism about the next phase of growth and customer success that lies ahead, emphasizing a commitment to modernizing work management for enterprises on a global scale. Post-acquisition, Smartsheet will cease to trade publicly but will continue operating under its existing name.
Interestingly, the deal includes a 'go-shop' provision that will expire on November 8, allowing Smartsheet the flexibility to consider a superior acquisition offer should one arise. Truist Securities commented in a Tuesday client note that the numerous media reports speculating about a potential buyout offer for Smartsheet over recent months suggest that any interested parties likely would have come forward before the current confirmation of the buyout news.
They concluded that the current proposal may be the most attractive and final offer available. In its recent fiscal second-quarter earnings report, Smartsheet disclosed adjusted earnings of $0.44 per share, an increase from $0.16 during the same quarter the previous year. Revenue surged by 17%, reaching $276.4 million.
Furthermore, the company has provided guidance for fiscal 2025, projecting adjusted earnings per share in the range of $1.36 to $1.39, with revenue anticipated between $1.116 billion and $1.121 billion. Blackstone's global co-head of technology investing, Martin Brand, along with senior managing director Sachin Bavishi, expressed excitement about the partnership with Smartsheet's management team, noting their aim to drive long-term growth by leveraging combined resources to enhance investments in future work management solutions.
Vista, too, has articulated its intention to support Smartsheet in achieving its ambitious goal of broadening access to its platform..