Vista, Blackstone To Buy Software Firm Smartsheet For $8.4 Billion

Vista Equity Partners and Blackstone agreed to acquire software maker Smartsheet for about $8.4 billion in cash.

Vista and Blackstone on Tuesday stated that they will be buying Smartsheet for $56.50 per share, representing a premium of about 41% over Smartsheet's 90-day average closing share price as of July 17, 2024, when media reports surfaced regarding a potential sale of the company. The deal price also represents a 16% premium to the highest closing stock price in the last 12 months ending July 17, 2024.

The deal gives Smartsheet a 45-day "go-shop" period, which would end on Nov. 8. During this period, Smartsheet will be allowed to seek other acquisition proposals from third parties and will have the right to terminate the merger agreement with Vista and Blackstone to accept a superior proposal.

"For more than a decade, we have built a thriving community of employees, partners, and customers, each focused on building and benefiting from Smartsheet's industry-leading work management platform. Our next phase of growth and customer success is underway, and we look forward to partnering with Blackstone and Vista Equity Partners to accelerate our vision of modernizing work management for enterprises, globally," said Mark Mader, CEO of Smartsheet in a statement.

"Modern enterprises rely on Smartsheet's simple and scalable solutions to manage a diverse range of business-critical processes every single day because they enable seamless collaboration, enhanced productivity and faster and more informed decision-making," Monti Saroya, Co-Head of Vista's Flagship Fund and Senior Managing Director, and John Stalder, Managing Director at Vista, commented about the deal.

The executives said they are looking forward to "partnering closely with Blackstone and Smartsheet to support its ambitious goal of making its platform accessible for every organization, team and worker relying on collaborative work to achieve successful outcomes."

The announcement came following a cut made by the Federal Reserve on its benchmark interest rate by an unusually large half-point. From a two-decade high of 5.3%, the Central Bank lowered it to 4.8%, paving the way for favorable conditions for businesses that would like to make acquisitions.

Smartsheet's board has approved the deal, which is expected to close in its fiscal fourth quarter ending January 31, 2025, subject to customary closing conditions including shareholder approval and required regulatory clearances.

Founded in 2005, Bellevue, Washington-based Smartsheet is an enterprise work management platform and is present in more than 80% of Fortune 500 companies around the globe.

Shares of Smartsheet closed Tuesday's regular trading session up 6.47% at $55.46 on the New York Stock Exchange.