Hub International Limited (HUB), a leading global insurance brokerage and financial services firm, announced today that it has entered into a definitive agreement for a minority common equity investment of approximately $1.6 billion, valuing HUB at a $29 billion total enterprise valuation. The investment is being led by funds and accounts advised by T. Rowe Price Investment Management, Inc., Alpha Wave Global, and Temasek, with participation from other new and existing investors.

HUB’s valuation has increased from $4.4 billion in 2013 when Hellman & Friedman (H&F) initially invested in the company, to $10 billion in 2018 when Altas Partners (Altas) acquired a minority stake, to $23 billion in 2023 when Leonard Green & Partners, L.P. (LGP) announced its minority investment, to today’s $29 billion valuation — the largest enterprise value to date for a private insurance broker. The increased valuation is underpinned by more than a fourfold increase in HUB’s annual revenue during this period, from $1.1 billion in 2013 to $4.8 billion in 2024.

The recurring nature of these investments reflects continued investor confidence in HUB’s scale, profitability, organic revenue growth, and maintained focus on middle and upper middle market clients. HUB’s consistent organic growth is supported by industry-leading net new business performance, ongoing focus on cross-selling, seamless M&A integration, new distribution channels and digital solutions, and talent acquisition.

“HUB’s unparalleled middle market experience over the past 25+ years delivering industry and product specialization and risk management solutions brings a significant differentiation and level of expertise to our clients,” said Marc Cohen, Chairman and CEO, HUB International. “Our ongoing investments in innovation, proprietary products, and strategic M&A, along with our commitment to learning and development, has led to consistent performance and strength in our organic growth and new business generation.”

This transaction is the next chapter in HUB’s commitment to make regular liquidity available to existing shareholders via an innovative Liquid Private Placement (LPP) implemented in connection with LGP’s 2023 investment. Existing institutional shareholders were provided the option to pursue liquidity in connection with this transaction. Lack of selling appetite allowed the investment proceeds to provide primary capital for growth initiatives and other general corporate purposes, such as acquisitions, debt repayments, and maintaining excess cash on HUB’s balance sheet.

H&F will retain a controlling interest in HUB, while the company’s management team will continue to hold a significant equity position. Altas and LGP will remain significant minority shareholders and will continue to be represented on HUB’s board of directors. The company does not expect to use the investment proceeds to fund secondary redemptions from existing equity holders.

“Our long-term relationship with HUB speaks volumes of the caliber of the organization,” said Hunter Philbrick, Partner at Hellman & Friedman. “As the fifth largest broker in the world and a leader in servicing the middle market, they’ve displayed a level of focus that has and continues to drive significant growth.”

Morgan Stanley Smith Barney LLC and Goldman Sachs & Co. LLC served as financial advisors to HUB and Simpson Thacher & Bartlett LLP served as legal counsel to HUB. The transaction is expected to be completed by the end of May 2025.

Morgan Stanley previously served as exclusive financial advisor and Simpson Thacher & Bartlett LLP served as legal counsel to HUB in connection with LGP’s 2023 investment.

About Hub International
Headquartered in Chicago, Illinois, Hub International Limited is a leading full-service global insurance broker and financial services firm providing risk management, insurance, employee benefits, retirement and wealth management products and services. With more than 19,000 employees in offices located throughout North America, Hub’s vast network of specialists brings clarity to a changing world with tailored solutions and unrelenting advocacy, so clients are ready for tomorrow. For more information, visit Hub Media Center.

About Hellman & Friedman
Hellman & Friedman is a preeminent global private equity firm with a distinctive investment approach focused on a limited number of large-scale equity investments in high-quality growth businesses. H&F seeks to partner with world-class management teams where its deep sector expertise, long-term orientation, and collaborative partnership approach enable companies to flourish. H&F targets outstanding businesses in select sectors, including technology, financial services, healthcare, consumer services & retail, and information, content & business services.

Since its founding in 1984, H&F has invested in over 100 companies and has over $115 billion in assets under management as of December 31, 2024. Learn more about H&F’s defining investment philosophy and approach to sustainable outcomes at www.hf.com.

About Altas Partners
Altas Partners is a North American private equity firm focused on selectively acquiring significant interests in high-quality businesses with meaningful growth potential. Altas focuses on sub-sectors where it has deep expertise, seeking one or two compelling investment opportunities each year. The Firm’s patient investment philosophy and engaged approach to ownership distinguish Altas as a buyer of choice for many management teams and founders.

The Firm was founded in 2012 and operates from offices in Toronto and New York. Altas manages more than $10 billion on behalf of leading institutional and family office investors from around the world. For additional information, please visit www.altas.com.

About LGP
LGP is a leading private equity investment firm founded in 1989 and based in Los Angeles, California with approximately $75 billion of assets under management. The firm partners with experienced management teams and often with founders to invest in market-leading companies. Since inception, LGP has completed over 150 investments in the form of traditional buyouts, going-private transactions, recapitalizations, growth equity, and selective public equity and debt positions. The firm primarily focuses on companies providing services, including consumer, healthcare and business services, as well as distribution and industrials. For more information, please visit www.leonardgreen.com.

MEDIA CONTACTS:
Marni Gordon
Phone: 312-279-4601
Marni.gordon@hubinternational.com

Jessica Wiltse
Phone: 312-596-7573
jessica.wiltse@hubinternational.com

SOURCE Hub International Limited

The post HUB Secures Significant Minority Investment and Reaches New Milestone With $29 Billion Valuation Demonstrating Confidence in the Company’s Sustainable Top Tier Organic Growth appeared first on Hellman & Friedman.

Expanded industry specialization, geographic reach and private equity investment position the firm for long-term growth and innovation.

In a transformative move that redefines advisory and accounting services for the middle market, Baker Tilly and Moss Adams today announced their planned combination to create the sixth largest advisory CPA firm in the US. Expected to close in early June of this year, the combination strengthens the firms’ industry specialization, expands its geographic reach and enhances its capabilities across advisory, tax and assurance services.

With complementary strengths and a shared commitment to client success, Baker Tilly and Moss Adams will unite under the Baker Tilly name, forming a leading firm positioned to help middle-market businesses navigate an increasingly complex environment. Jeff Ferro, CEO of Baker Tilly, will serve as CEO of the combined firm through his retirement, with Eric Miles, currently Moss Adams CEO, named CEO-elect. Miles will assume the role of CEO on January 1, 2026, with Ferro remaining a director on Baker Tilly’s board thereafter.

As part of this transaction, private equity firm Hellman & Friedman (H&F), an existing investor in Baker Tilly, will make a meaningful additional strategic investment in the business, with existing shareholder Valeas Capital Partners (Valeas) also increasing its investment. Following the deal close, Moss Adams and Baker Tilly’s audit business will combine as Baker Tilly US, LLP and the firms’ business advisory, tax and other services will combine under Baker Tilly Advisory Group, LP (BTAG). Both entities will remain partnerships, with all principals holding equity alongside H&F and Valeas in BTAG.

Leadership Vision and Strategic Alignment
Jeff Ferro, CEO of Baker Tilly, underscored the strategic alignment between the two firms: “Moss Adams is a great strategic fit with Baker Tilly. We’ve long respected the firm, its people and its industry-focused approach. By bringing together our strengths, we are expanding our ability to serve middle-market businesses with greater expertise, resources and insights.”

Eric Miles, Chairman and CEO of Moss Adams, emphasized the benefits to clients and professionals: “The resources, geographic reach and go-to-market strength of the combined firm magnifies opportunities for our people to grow, collaborate and innovate. We are proud to offer our clients these expanded resources to deliver even greater value and set a new standard for advisory services in the middle market.”

Blake Kleinman, Partner at H&F, commented: “Since we invested in Baker Tilly, we have been focused on building a differentiated firm with the ambition to change the game in the middle-market accounting industry. This landmark merger between Baker Tilly and Moss Adams is an important step in creating a firm that will be the destination of choice for the industry’s best talent and for firms considering their strategic options in a rapidly evolving sector.”

A Step Forward for the Middle Market
Both firms have a century-old history and commitment to fostering a people-first culture, supporting professionals with career development pathways, mentorship and specialized resources. This commitment to people and delivering on behalf of middle-market clients will be strengthened as they combine forces.

Barry Melancon, strategic advisor to Baker Tilly, former longtime AICPA CEO and independent chair-elect of the Baker Tilly International board of directors, highlighted the relevance of the transaction: “The CPA and advisory profession requires firms to operate effectively at the local, national and global levels. This combination brings together two firms at the forefront of the profession, further empowering them to deliver on their commitment to serving their clients as the needs of middle-market businesses evolve.”

Simpson Thacher & Bartlett LLP and Vedder Price PC served as legal advisors to Baker Tilly. Deutsche Bank Securities Inc. served as financial advisor and Dechert LLP as legal advisor to Moss Adams.

About Baker Tilly (bakertilly.com)
Baker Tilly is a leading advisory, tax and assurance firm, providing clients with a genuine coast-to-coast and global advantage in major regions of the U.S. and in many of the world’s leading financial centers – New York, London, San Francisco, Los Angeles, Chicago and Boston. Baker Tilly Advisory Group, LP and Baker Tilly US, LLP (Baker Tilly) provide professional services through an alternative practice structure in accordance with the AICPA Code of Professional Conduct and applicable laws, regulations and professional standards. Baker Tilly US, LLP is a licensed independent CPA firm that provides attest services to its clients. Baker Tilly Advisory Group, LP and its subsidiary entities provide tax and business advisory services to their clients. Baker Tilly Advisory Group, LP and its subsidiary entities are not licensed CPA firms.

Baker Tilly Advisory Group, LP and Baker Tilly US, LLP, trading as Baker Tilly, are independent members of Baker Tilly International, a worldwide network of independent accounting and business advisory firms in 143 territories, with 43,500 professionals and a combined worldwide revenue of $5.62 billion. Visit bakertilly.com or join the conversation on LinkedIn, Facebook and Instagram.

About Moss Adams (mossadams.com)
Moss Adams LLP is a leading accounting, consulting and wealth management firm serving clients nationally and globally. The firm’s more than 4,800 professionals operate from 30 locations across the U.S. and leverage Praxity, a global alliance of independent accounting firms, to meet client needs in 110 countries internationally. Assurance, tax, and consulting are offered through Moss Adams LLP. ISO/IEC 27001 services are offered through Moss Adams Certifications LLC. Investment advisory is offered through Moss Adams Wealth Advisors LLC. Services from India provided by Moss Adams (India) LLP. For more than 112 years, Moss Adams has empowered clients to embrace opportunity. Learn more at mossadams.com.

About Hellman & Friedman
Hellman & Friedman is a preeminent global private equity firm with a distinctive investment approach focused on a limited number of large-scale equity investments in high-quality growth businesses. H&F seeks to partner with world-class management teams where its deep sector expertise, long-term orientation, and collaborative partnership approach enable companies to flourish. H&F targets outstanding businesses in select sectors, including technology, financial services, healthcare, consumer services & retail, and information, content & business services. Since its founding in 1984, H&F has invested in over 100 companies and has over $115 billion in assets under management as of December 31, 2024. Learn more about H&F’s defining investment philosophy and approach to sustainable outcomes at www.hf.com.

SOURCE Baker Tilly and Moss Adams

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Mehiläinen is the largest healthcare and social care provider in Finland with a fast-growing international presence. As part of its international growth strategy, Mehiläinen has agreed to acquire leading healthcare providers Regina Maria in Romania and MediGroup in Serbia. In conjunction with these major acquisitions, Hellman & Friedman joins CVC in an investment partnership in Mehiläinen. The completion of the acquisitions and new Mehiläinen ownership arrangements is subject to regulatory and customary investor approvals.

Regina Maria is the leading private healthcare company in Romania, offering a wide range of multi-specialty outpatient healthcare services and hospital services. With its 11,000 professionals and 300 units, it serves over 2 million customers annually. Regina Maria’s sister company MediGroup is the leading service provider in the private healthcare market in Serbia with 100 units and over 2,500 employees. The combined revenue of the companies amounted to circa 550 million euros in 2024. The seller in the transaction is the private equity firm MidEuropa.

Regina Maria and MediGroup are highly trusted private healthcare brands with a strong commitment to medical excellence and development of healthcare services. The service offerings and business approach of the companies are closely aligned with those of Mehiläinen, providing a strong basis for future partnership. Regina Maria holds the Joint Commission International (JCI) accreditation, which reflects their hospitals’ high-quality work by proving compliance with international standards for patient safety and care quality. Over the past 15 years, Regina Maria’s entrepreneurial management team has grown the company’s revenue more than tenfold, with most of this growth occurring organically. After the acquisition, Regina Maria’s CEO Fady Chreih and his management team will continue in their current roles.

Alongside these exciting acquisitions Mehiläinen is also pleased to announce that Hellman & Friedman (“H&F”) will become a second major investor in Mehiläinen alongside CVC Funds, which first invested in Mehiläinen in 2018. H&F is a global private equity firm which has been investing in Europe for 25 years and has extensive experience in the healthcare sector.

New investors and funding will accelerate the execution of Mehiläinen’s growth strategy, which focuses on expanding both in Finland and in international markets through a combination of greenfield and service expansion, continuous enhancement of customer experience, and strategic acquisitions, all while keeping the highest standards of patient care and medical quality. The new investment will also support the ongoing international expansion of Mehiläinen’s fast growing Software as a Service business, BeeHealthy, which is already present in over 10 different countries.

Janne-Olli Järvenpää, long-time CEO of Mehiläinen and board member, is pleased with the acquisitions and the owners’ commitment to steady growth: “Regina Maria is one of the fastest-growing and highest-quality healthcare service providers in Europe, led by some of the best professionals in the field. We have closely followed the company’s development for years, and we are truly delighted with the opportunity to partner up with Regina Maria’s management following this acquisition. Regina Maria’s sister company MediGroup is also a leading player in its market with excellent quality. I am also delighted to welcome Hellman & Friedman, who brings significant global healthcare sector expertise, alongside CVC. Mehiläinen’s revenue has grown more than fivefold over the last ten years. Private equity owners with a long-term value creation mindset play a key role in supporting Mehiläinen’s leadership in international expansion and service development.”

“We are honored that the largest healthcare provider in Finland, with over a century of medical experience, recognizes the potential of the medical market in Romania and Serbia. This investment reflects Mehiläinen Group’s confidence in the economic development of the region and marks an extremely significant chapter in our network’s history. We are excited to step into this new stage, where we aim, together, to transform the European landscape of private healthcare, relying on strong management teams and an integrated vision. Together, we are moving towards a future of increasingly advanced, digitalized, and accessible healthcare, where patient safety and the quality of medical care remain paramount”, said Fady Chreih, CEO of Regina Maria and Chair of the Board of MediGroup.

“Janne-Olli and the rest of the management team have done a tremendous job in transforming Mehiläinen over the past 10 years, all while maintaining their unique entrepreneurial spirit and customer focused culture that is essential to the company’s success”, said Søren Vestergaard-Poulsen, a Managing Partner at CVC. “Mehiläinen is in the forefront of healthcare services trends when it comes to delivery of digitally-enabled multi-specialty outpatient care, with a strong commitment to quality and continuum of care. We look forward to working with the Mehiläinen and Regina Maria management teams to drive Mehiläinen’s next phase of growth, and welcome H&F as our partner on this exciting journey”, added Lave Beck-Friis, Senior Managing Director at CVC.

“Mehiläinen has a long history of excellence in healthcare provision and the business has been going from strength to strength”, said Hunter Philbrick and Stefan Goetz, Partners at Hellman & Friedman. “Its integrated model is at the forefront of healthcare, delivering superior patient outcomes. We look forward to supporting Janne-Olli and the Mehiläinen team on their continued growth and expansion across Europe.”

Other significant direct owners of Mehiläinen beyond CVC and H&F include the company’s management and key personnel, as well as large Finnish pension funds including e.g., Ilmarinen, Varma, and the State Pension Fund. Additionally, there are private investors and smaller institutional investors among the owners.

For more information:

Mehiläinen Group
CEO Janne-Olli Järvenpää
Contact via Communications Director Laura Martinsuo (laura.martinsuo@mehilainen.fi, +358 40 196 2892)

Regina Maria
CEO Fady Chreih
Contact via Communications Manager Cristiana Vago (cristiana.vago@reginamaria.ro, +407 2226 1866)

Mehiläinen Group is a well-known and highly respected private provider of social care and healthcare services, offering comprehensive high-quality services in its home market, Finland, as well as in Sweden, Germany, Lithuania, and Estonia. Mehiläinen offers digital healthcare software solutions through its subsidiary, BeeHealthy. 115-year-old Mehiläinen is a rapidly developing and growing leader in the industry. It serves 2.2 million customers annually, and services are provided at 890 locations by more than 37,000 employees and private practitioners. Mehiläinen invests in the possibilities of digitalisation and the effectiveness and quality of care in all its business areas. www.mehilainen.fi

Regina Maria – The Healthcare Network is the leader in medical quality in Romania, being the only private health operator within the country with five hospitals internationally accredited. With 22 accreditations – a unique achievement in Central and Eastern Europe – Regina Maria continuously demonstrates its commitment to medical excellence and patient safety. Over the past decade, more than 960,000 reviews have been given by patients to Regina Maria doctors through a unique feedback system, resulting in an average rating of 9.63 across the Network. Regina Maria is also the leader in healthcare digitalization in Romania, with the Regina Maria medical app being the most downloaded and widely used app of its kind, boasting over 1.7 million patient accounts.

MediGroup – The Healthcare Network is the leading private healthcare system in Serbia. Established in 2013, it has grown from a few hundred employees to a team of over 2,500 dedicated professionals. With a nationwide presence and a network that includes 16 healthcare centers and polyclinics, a general hospital, 3 specialty hospitals, 4 diagnostic centers, and more than 75 laboratories, MediGroup provides a comprehensive range of healthcare services—from preventive check-ups and diagnostic testing to advanced surgical procedures. Driven by a commitment to excellence, the system continues to evolve, ensuring top-tier medical care through the latest standards and cutting-edge technology. 

CVC is a leading global private markets manager with a network of 30 office locations throughout EMEA, the Americas, and Asia, with approximately €200 billion of assets under management. CVC has seven complementary strategies across private equity, secondaries, credit and infrastructure, for which CVC funds have secured commitments of approximately €249 billion from some of the world’s leading pension funds and other institutional investors. Funds managed or advised by CVC’s private equity strategy are invested in over 140 companies worldwide, which have combined annual sales in excess of €162 billion and employ more than 580,000 people. For further information about CVC please visit: https://www.cvc.com/. Follow us on LinkedIn.

Hellman & Friedman is a preeminent global private equity firm with a distinctive investment approach focused on a limited number of large-scale equity investments in high-quality growth businesses. H&F seeks to partner with world-class management teams where its deep sector expertise, long-term orientation, and collaborative partnership approach enable companies to flourish. H&F targets outstanding businesses in select sectors, including technology, financial services, healthcare, consumer services & retail, and information, content & business services. Since its founding in 1984, H&F has invested in over 100 companies and has over $115 billion in assets under management as of September 30, 2024. Learn more about H&F’s defining investment philosophy and approach to sustainable outcomes at www.hf.com.

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With this acquisition, the AutoScout24 Group, which includes leading online automotive marketplaces in continental Europe, Germany’s largest online automotive market for leasing offers, LeasingMarkt.de, and one of Europe’s fastest-growing B2B used car trading platforms, AutoProff, extends its presence outside of Europe and strengthens its position as a leading global online automotive marketplace. The transaction also expands AutoScout24’s service offering into automotive dealer software and lender solutions through TRADER Canada’s leading offerings.

TRADER Canada operates Canada’s leading online automotive marketplaces, English-language AutoTrader.ca and French-language AutoHebdo.net, with 26 million monthly visits, more than 450,000 vehicle listings, and 5,000 dealer partners. Founded in 1975 and headquartered in Toronto, the company also provides several automotive dealer software solutions under the AutoSync brand and operates DealerTrack, the leading Canadian portal connecting automotive dealers and lenders, as well as Collateral Management Solutions, the primary provider of lien and registration services, recovery services, and insolvency management solutions to Canadian Lenders. Throughout their ownership, Thoma Bravo worked closely with TRADER Canada to expand its innovative product portfolio through both organic investments and strategic acquisitions to better serve the company’s growing customer base.

Peter Brooks-Johnson, CEO of the AutoScout24 Group: “I am delighted to welcome the TRADER Canada team and its leading brands to the AutoScout24 family. TRADER Canada’s impressive long-term track record, clear position as Canada’s most important automotive marketplace, and comprehensive expertise in dealer software and fintech solutions speak for themselves. This acquisition strengthens AutoScout24’s position as a leading global online automotive marketplace and will help accelerate the growth of both platforms. As a result, we will offer our customers, trade partners, OEMs, and financing partners in Europe and Canada better services and more innovative solutions.”

Sebastian Baldwin, President and CEO of TRADER Corporation: “AutoScout24’s track record of success with their automotive marketplaces presents a perfect alignment with the TRADER Canada business and our future long-term goals. In addition to our marketplaces, which are the #1 most trusted choice for Canadian car shoppers, our market-leading software and automotive finance solutions businesses represent further opportunities for collaboration. We look forward to working together to continue strengthening TRADER Canada’s market leading position across the breadth of the Canadian automotive sector.”

Blake Kleinman, Partner at H&F: “We have been successful investors in the automotive classifieds sector since 2014 and have come to appreciate the commonality, across all geographies, of the strategic product innovations required to maximize the efficiency of the car buying journey for consumers and dealers. Bringing TRADER Canada into the AutoScout24 family significantly enhances our ability to leverage our global scale and common technology platform to invest in innovation that will better serve consumers, dealers, and our other partners. The additional equity investment from H&F in this transaction demonstrates our long-term vision of building the leading global automotive classifieds platform.”

Holden Spaht, a Managing Partner at Thoma Bravo: “It’s been a privilege to work with Sebastian and the TRADER Canada team. Through the application of our software expertise and M&A strategy, we helped transform TRADER Canada from an online automotive marketplace to a market leading platform of digital retail solutions for consumers and automotive dealers in Canada. We are confident that AutoScout24 is a great home for TRADER Canada, and we look forward to following their continued success together.” Peter Stefanski, a Partner at Thoma Bravo added: “We are proud to have supported TRADER Canada over the course of our investment, driving growth and innovation while creating a better experience for both dealers and car-buyers across all of Canada.”

The transaction is expected to close in the fourth quarter of 2024. RBC Capital Markets and Deutsche Bank are acting as M&A advisors to AutoScout24 and Simpson Thacher & Bartlett LLP, Davies Ward Philipps & Vineberg LLP and Freshfields Bruckhaus Deringer LLP are acting as legal counsel. Goldman Sachs & Co. LLC is acting as lead financial advisor; BofA Securities and HSBC Securities (USA) Inc. are also acting as financial advisors to TRADER Canada and Kirkland & Ellis LLP, McMillan LLP and Goodmans LLP are acting as legal counsel.

About AutoScout24
With over 2 million vehicle listings, around 30 million users per month and more than 43,000 dealer partners, AutoScout24 is the largest pan-European online car market. In addition to Germany, the AutoScout24 Group is also represented in the European core markets of Belgium, Luxembourg, the Netherlands, Italy, France, Austria, Norway, Denmark, Poland and Sweden. As a comprehensive marketplace for mobility, AutoScout24 is making targeted investments in the growth areas of leasing, car subscriptions, electromobility and online car purchases. With AutoScout24 smyle, the marketplace enables its users to purchase vehicles completely online – free of charge and delivered ready-to-drive directly to their doorstep. Leasing specialist LeasingMarkt.de has also been part of the AutoScout24 Group since 2020 and the B2B auction platform AUTOproff since 2022. Together, the marketplaces are significantly driving the digitalisation of the European car trade.

More information on www.autoscout24.de

Media Contact:
Julia Dreßen
Fon +49 89 444 56-1185
presse@autoscout24.de

About TRADER Corporation:
TRADER Corporation is a trusted Canadian leader in online media, dealership and OEM software, and lender services. The company is comprised of AutoTrader.ca, AutoHebdo.net, LesPac.com, AutoSync, Dealertrack and Collateral Management Solutions. AutoTrader.ca and AutoHebdo.net offer the largest inventory of new and used vehicles in Canada, receiving over 26 million monthly visits to over 450,000 vehicles listed by over 5,000 dealers. With over 2,500 subscribers and counting, AutoSync is the largest and fastest growing dealer and OEM software provider in Canada. The platform’s suite of connected automotive software solutions brings advertising, conversion and operational support together, synchronizing the entire retail process. The portfolio is rounded out by DealerTrack, the leader in Canadian automotive finance solutions, and Collateral Management Solutions, the primary provider of lien and registration services, recovery services, and insolvency management solutions to Canadian Lenders.

For more information, please visit www.tradercorporation.com

Media Contact:
Jessica Huynh
Jessica.huynh@labourcreative.ca

SOURCE AutoScout24

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New investment poised to accelerate growth; Continued partnership with Stone Point Capital.

Safe-Guard Products International, LLC, a leading provider of third-party private label finance and insurance protection products for the automotive, RV, marine, and powersports industries, today announced that it has closed on a majority investment from Hellman & Friedman, one of the world’s largest private equity firms.

The strategic partnership is set to propel Safe-Guard’s growth and solidify its position as the premier provider of finance and insurance products and solutions in the sector. Stone Point Capital LLC, a longstanding investor in Safe-Guard, will continue to partner with the company and participate on Safe-Guard’s board.

Safe-Guard’s management team will continue to drive the success of the business for the benefit of its partners, their customers and other stakeholders. In connection with the transaction, Randy Barkowitz is assuming a board-level leadership role as full-time Executive Chairman, while David Pryor is continuing in his role as President and assuming the responsibility of Chief Executive Officer of Safe-Guard.

“We are thrilled to welcome Hellman & Friedman as our new majority investor,” said Barkowitz. “Safe-Guard’s commitment to excellence remains steadfast. With Hellman & Friedman’s backing and Stone Point’s continued support, we are positioned to deliver even more innovative solutions, superior service and unmatched value to our partners and their customers.”

Hellman & Friedman, renowned for its focus on helping industry leaders reach new heights, fully embraces Safe-Guard’s unique strategy and the strength of its management team. The investment highlights Hellman & Friedman’s commitment to supporting Safe-Guard in delivering F&I products, dealer service, customer satisfaction, and technology solutions. Through this investment, Safe-Guard will gain additional resources to invest in its people, processes, and technology.

“Safe-Guard is a differentiated provider of private label protection products, offering value to dealers, strategic partners and consumers,” said Hunter Philbrick, Partner at Hellman & Friedman. “The business has built an impressive reputation for its high-quality products and service, and we are excited to partner with the talented management team and provide additional firepower to support the company’s strategic priorities. We see several significant growth opportunities and look forward to working together to realize the immense potential ahead.”

Based in Atlanta, Safe-Guard’s industry-defining Protection Products Platform delivers frictionless service, consistency, and customer-centric solutions to more than 19 million consumers who are protected under contracts administered by Safe-Guard.

Goldman Sachs & Co. LLC and SPC Capital Markets LLC acted as financial advisors to Safe-Guard and Debevoise & Plimpton LLP served as legal counsel to the company. Jefferies LLC was the lead financial advisor to Hellman & Friedman, with Waller Helms Advisors also providing financial advice and Kirkland & Ellis acting as legal counsel.

About Safe-Guard Products International
Founded in 1992 and based in Atlanta, Safe-Guard Products International, LLC, is the leading provider of branded vehicle protection products in the finance and insurance space to the automotive, RV, marine, and motorcycle/powersports industries. Through its Protection Products Platform, Safe-Guard develops the highest-quality programs and matches them with unparalleled customer service and advanced technology solutions, which are fostered by superior sales and marketing support. Visit safe-guardproducts.com for more information.

About Hellman & Friedman
Hellman & Friedman is a preeminent global private equity firm with a distinctive investment approach focused on a limited number of large-scale equity investments in high-quality growth businesses. H&F seeks to partner with world-class management teams where its deep sector expertise, long-term orientation, and collaborative partnership approach enable companies to flourish. H&F targets outstanding businesses in select sectors, including technology, financial services, healthcare, consumer services & retail, and information, content & business services.

Since its founding in 1984, H&F has invested in over 100 companies. The firm is currently investing its tenth fund, with over $24 billion of committed capital, and has over $115 billion in assets under management as of March 31, 2024. Learn more about H&F’s defining investment philosophy and approach to sustainable outcomes at www.hf.com.

About Stone Point Capital
Stone Point is an alternative investment firm based in Greenwich, CT, with more than $55 billion of assets under management. Stone Point targets investments in companies in the global financial services industry and related sectors. The firm invests in alternative asset classes, including private equity through its flagship Trident Funds and credit through commingled funds and separately managed accounts. In addition, Stone Point Capital Markets supports our firm, portfolio companies and other clients by providing dedicated financing solutions. For more information on Stone Point, please visit: www.stonepoint.com.

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Additional information about Resideo can be found at Resideo.com.

Media Contacts

Danielle Karr
Director, Public Relations & Events
Danielle.Karr@snapone.com

The post Snap One Announces Completion of Acquisition by Resideo appeared first on Hellman & Friedman.

• Creates strong position in security, audio visual, and smart living technology distribution for residential and commercial markets
• Highly complementary capabilities offer professional integrators an expanded selection of proprietary products, extensive third-party supplier relationships, and proven omni-channel reach
• Enhances Resideo’s growth and margin profile and accretive to non-GAAP EPS in first full year of ownership
• Identified expected annual run-rate business and financial synergies of $75 million by year three
• $500 million perpetual convertible preferred equity investment from CD&R

Resideo Technologies, Inc. (NYSE: REZI), a leading manufacturer and distributor of technology-driven products and solutions, and Snap One Holdings Corp. (Nasdaq: SNPO), a leading provider of smart-living products, services, and software to professional integrators, today announced a definitive agreement pursuant to which Resideo has agreed to acquire Snap One for $10.75 per share in cash, for a transaction value of approximately $1.4 billion, inclusive of net debt. Upon closing, Snap One will integrate into Resideo’s ADI Global Distribution business.

The transaction will combine ADI’s strong position in security products distribution and Snap One’s complementary capabilities in the smart living market and innovative Control4 technology platforms, which is expected to drive increased value for integrators and financial returns. Together, ADI and Snap One will provide integrators an increased selection of both third-party products and proprietary offerings through an extensive physical branch footprint augmented by industry leading digital capabilities.

“The acquisition of Snap One is an exciting step in Resideo’s continued transformation through portfolio optimization, operational enhancements and structural cost savings actions,” commented Jay Geldmacher, Resideo’s President and Chief Executive Officer. “ADI and Snap One are highly complementary businesses and together will meaningfully enhance our strategic and operational capabilities as a significant player in attractive growth categories. We are excited about the enhanced value proposition through increased product breadth, local availability, support services and broad market expertise, as well as the future opportunities this creates for integrators serving residential and commercial markets. In addition, the investment by Clayton, Dubilier & Rice is a testament to the strategic and financial merits of this transaction and provides financial flexibility as we continue to transform and optimize our portfolio. We look forward to the ADI and Snap One teams working together to drive value for all stakeholders through executing on the substantial business and financial synergies we see in combining the two businesses.”

“Snap One has grown from a startup built by entrepreneurial integrators to an industry leader in smart technology, delivering seamless experiences to consumers and high-quality services and support to our integrators,” said John Heyman, Chief Executive Officer of Snap One. “This is the right next step to capture new opportunities to bring our solutions to market. The future of smart living is here. Demand for connected technology products continues to grow, and Resideo is the right owner to drive our expansion. We believe this transaction will deliver compelling value to our stakeholders and will create opportunities for our people and integrator partners.”

“We are excited to support Resideo on this highly strategic acquisition and in their ongoing transformation,” commented Nathan Sleeper, CD&R’s Chief Executive Officer. “I look forward to joining Resideo’s Board of Directors and supporting the business as it executes on this transaction and the significant opportunity we see available over the coming years.”

Benefits of the Transaction

A Strong Position Across Multiple Attractive Categories: The acquisition will combine Snap One’s capabilities for smart living integrators with ADI’s complementary position in adjacent security products distribution. This cross-category expansion will allow the combined organization to materially deepen relationships with integrators to better serve their customers and expand their businesses.

Expansion of Proprietary Offering: The combination is expected to meaningfully accelerate ADI’s existing exclusive brands strategy, leveraging Snap One’s award-winning proprietary product portfolio and product development expertise while providing broader availability through ADI’s network of commercial and residential integrators and omni-channel capabilities. The combined company intends to leverage increased opportunities around innovation to drive value for integrators through a pipeline for proprietary products. Snap One generated 66% of sales from proprietary products in 2023 and these offerings typically carry significantly higher gross margin than third-party products.

Enhanced Integrator Value Proposition: ADI’s and Snap One’s professional integrators will benefit from significant synergy on go-to-market with Snap One’s e-commerce expertise and integrator support platforms and ADI’s 195 stocking locations and extensive digital capabilities. The combination is expected to create a true omni-channel experience for integrators, simplifying the buying experience and enhancing product availability. Additional opportunity exists to enhance value within the Control4 integrator base through increasing service levels, rapid product fulfilment and expanding exclusive offerings.

Attractive Financial Profile: The transaction is expected to be accretive to Resideo non-GAAP EPS in the first full year of ownership, with favorable revenue growth and margin profile to ADI and Resideo as a whole. Transaction financing has been structured to allow Resideo to preserve financial flexibility for future strategic initiatives.

Transaction Details

The transaction is valued at approximately $1.4 billion, including forecasted net debt of Snap One at the closing of approximately $460 million. This represents a 7.4x multiple on Snap One’s Adjusted EBITDA for the twelve months ended December 29, 2023, as further adjusted by including Resideo’s projected annual run-rate synergies of $75 million.

The transaction is expected to be completed in the second half of 2024, and is subject to customary closing conditions, including receipt of applicable antitrust and other regulatory approvals. The transaction has been unanimously approved by the Boards of Directors of Resideo and Snap One. Private investment funds managed by Hellman & Friedman LLC, holding approximately 72% of the outstanding common shares of Snap One, have executed a written consent to approve the merger, thereby providing the required stockholder approval for the transaction.

Resideo intends to use proceeds from committed debt financing, cash on hand, and a $500 million perpetual convertible preferred equity investment from Clayton, Dubilier & Rice LLC (“CD&R”) to fund the transaction. Terms of the CD&R investment include a 7% coupon, payable in cash or payment-in-kind at Resideo’s option, and a conversion price of $26.92. CD&R brings a long track record of value creation through its investments and significant experience in the specialty distribution market. Effective upon the closing, CD&R will have the right to designate two members to the Board of Directors of Resideo.

Transaction Conference Call Information

Resideo will host a conference call at 8:00 a.m. Eastern Time on April 15, 2024, to discuss the transaction. Interested parties may join the call via https://investor.resideo.com/, where related materials will be posted before the call, or by phone at 646-968-2525 or 888-596-4144 with the conference ID: 7959274. A replay of the webcast will be available at https://investor.resideo.com/.

Resideo Preliminary First Quarter 2024 Financial Results

For the first quarter ended March 30, 2024, Resideo’s preliminary expectations are for revenue of approximately $1,485 million, compared with outlook of $1,460 million to $1,510 million and Adjusted EBITDA above the midpoint of outlook of $120 million to $140 million provided in the fourth quarter and full-year 2023 results press release dated February 13, 2024. Resideo intends to release first quarter 2024 financial results after the close of the New York Stock Exchange on Thursday, May 2, 2024, and host a webcasted conference call at 5 p.m. ET.

Advisors
Evercore and Raymond James & Associates, Inc. are acting as financial advisors and Willkie Farr & Gallagher LLP is acting as legal counsel to Resideo. Bank of America and Morgan Stanley have provided committed financing for the transaction and are also acting as advisors to Resideo. Moelis & Company LLC and J.P. Morgan Securities LLC are serving as financial advisors to Snap One and have each provided a fairness opinion to Snap One’s board of directors. Simpson Thacher & Bartlett LLP is serving as Snap One’s legal counsel.

About Resideo
Resideo is a leading global manufacturer and developer of technology-driven products and components that provide critical comfort, energy management, and safety and security solutions to over 150 million homes globally. Through our ADI Global Distribution business, we are also a leading wholesale distributor of professionally installed electronic security and life safety products for commercial and residential markets and serve a variety of adjacent product categories including audio visual, data communications, and smart home solutions. For more information about Resideo, please visit www.resideo.com.

About Snap One
As a leading distributor of smart-living technology, Snap One empowers its vast network of professional integrators to deliver entertainment, connectivity, automation, and security solutions to residential and commercial end users worldwide. Snap One distributes an expansive portfolio of proprietary and third-party products through its intuitive online portal and local branch network, blending the benefits of e-commerce with the convenience of same-day pickup. The Company provides software, award-winning support, and digital workflow tools to help its integrator partners build thriving and profitable businesses. Additional information about Snap One can be found at www.snapone.com.

About Clayton, Dubilier & Rice
Founded in 1978, CD&R is a leading private investment firm with a strategy of generating strong investment returns by building more robust and sustainable businesses through the combination of skilled investment experience and deep operating capabilities. In partnership with the management teams of its portfolio companies, CD&R takes a long-term view of value creation and emphasizes positive stewardship and impact. The firm invests in businesses that span a broad range of industries, including industrial, healthcare, consumer, technology and financial services end markets. CD&R is privately owned by its partners and has offices in New York and London. For more information, please visit www.cdr-inc.com and follow the firm’s activities through LinkedIn and @CDRBuilds on X/Twitter.

Residio Investors:
Jason Willey
Residio Vice President, Investor Relations
investorrelations@resideo.com

Adrienne Zimoulis
Residio Sr. Director of Communications
adrienne.zimoulis@resideo.com

Snap One:
Ashley Swenson
Senior Vice President, Marketing
ashley.swenson@snapone.com

Dana Gorman / Dan Scorpio
H/Advisors Abernathy
dana.gorman@h-advisors.global / dan.scorpio@h-advisors.global

Clayton, Dubilier & Rice Media:
Jon Selib
Clayton, Dubilier & Rice Media
jselib@cdr-inc.com

Use of Non-GAAP Financial Measures
This press release includes certain “non-GAAP financial measures” as defined under the Securities Exchange Act of 1934. Resideo management believes the use of such non-GAAP financial measure, specifically Adjusted EBITDA, assists investors in understanding the ongoing operating performance of Resideo by presenting the financial results between periods on a more comparable basis. Non-GAAP Adjusted EBITDA should not be considered in isolation or as an alternative to results determined in accordance with U.S. GAAP. Resideo defines non-GAAP Adjusted EBITDA as Net Income as determined in accordance with U.S. GAAP, adjusted for the following items: provision for income taxes; depreciation and amortization expenses; interest expense, net; stock-based compensation expense; Honeywell reimbursement agreement non-cash expense; restructuring and impairment expenses; loss on the sale of assets, net, and foreign exchange transaction loss (income).

Resideo is unable to provide preliminary results for the comparable U.S. GAAP measure of Adjusted EBITDA for the first quarter 2024 without unreasonable efforts because the closing procedures for the first quarter of 2024 are not yet complete. Accordingly, Resideo is unable to provide a reconciliation from U.S. GAAP to non-GAAP Adjusted EBITDA without unreasonable effort. It is important to note that the amounts adjusted to the comparable U.S. GAAP measure may be material to Resideo’s first quarter 2024 reported results determined in accordance with U.S. GAAP.

This press release also includes a reference to Snap One’s Adjusted EBITDA, which is a non-GAAP financial measure. Snap One’s management believes that this non-GAAP financial measure provides useful information about the proposed transaction; however, it should not be considered as an alternative to U.S. GAAP net income (loss). A reconciliation between Snap One’s Adjusted EBITDA and U.S. GAAP net income (loss) for the annual period ended December 29, 2023, is provided in Snap One’s Annual Report filed with the SEC on Form 10-K on March 9, 2024.

Forward Looking Statements
This release contains “forward-looking statements” within the meaning of the federal securities laws. All statements, other than statements of fact, that address activities, events or developments that we or our management intend, expect, project, believe or anticipate will or may occur in the future are forward-looking statements. Although we believe forward-looking statements are based upon reasonable assumptions, such statements involve known and unknown risks, uncertainties, and other factors, which may cause the actual results or performance of each company to be materially different from any future results or performance expressed or implied by such forward-looking statements. Such risks and uncertainties include, but are not limited to, (1) the ability of the conditions to the closing of the Snap One transaction being timely satisfied and the consummation of the transaction, (2) the ability of Snap One and/or Resideo to drive increased customer value and financial returns and enhance strategic and operational capabilities, (3) the ability of Snap One and/or Resideo to achieve the targeted amount of synergies and the related valuation implications described in this press release, (4) the accretive nature of the transaction to Resideo’s non-GAAP EPS in the first full year of ownership and the growth and margin profile of the combined businesses, (5) the ability to accelerate brand strategy as a result of the transaction, (6) the ability to integrate the Snap One business into Resideo and realize the anticipated strategic benefits of the transaction, including the anticipated operational and strategic benefits of the transaction, (7) actual Resideo results for the first quarter ended March 30, 2024 differing from the estimated financial results included in this press release, including due to the completion of our financial closing procedures, final adjustments and other developments that may arise between the date of this press release and the time that financial results for the first quarter of 2024 are finalized, (8) our expectation that the financing for the transaction will allow Resideo to maintain our existing credit ratings and preserve financial flexibility for future strategic initiatives, (9) the ability to recognize the expected savings from, and the timing and impact of, existing and anticipated cost reduction actions (10) the likelihood of continued success of our transformation programs and initiatives, and (11) the other risks described under the headings “Risk Factors” and “Cautionary Statement Concerning Forward-Looking Statements” in Resideo’s Annual Report on Form 10-K for the year ended December 31, 2023 and the other risks described under the headings “Risk Factors” and “Cautionary Statement Concerning Forward-Looking Statements” in Snap One’s Annual Report on Form 10-K for the fiscal year ended December 29, 2023 and such other periodic filings as each of Resideo and Snap One make from time to time with the Securities and Exchange Commission (SEC). You are cautioned not to place undue reliance on these forward-looking statements. Forward-looking statements are not guarantees of future performance, and actual results, developments, and business decisions may differ from those envisaged by our forward-looking statements. Except as required by law, we undertake no obligation to update such statements to reflect events or circumstances arising after the date of this press release, and we caution investors not to place undue reliance on any such forward-looking statements

View original content: https://www.prnewswire.com/news-releases/resideo-to-acquire-snap-one-to-expand-presence-in-smart-living-products-and-distribution-302116276.html

SOURCE Resideo Technologies, Inc.

The post Resideo to Acquire Snap One to Expand Presence in Smart Living Products and Distribution appeared first on Hellman & Friedman.

It’s a new day for your data. Cisco, supercharged by Splunk, will revolutionize the way companies harness data to connect and protect every aspect of their organizations.

News Summary

• Cisco is now uniquely poised to power, protect, and advance the AI revolution for customers
• Cisco will bring the full power of the network together with market-leading security and observability solutions
• With Splunk, Cisco becomes one of the largest software companies globally

Cisco (NASDAQ: CSCO) today announced it completed the acquisition of Splunk, setting the foundation for delivering unparalleled visibility and insights across an organization’s entire digital footprint.

To thrive in the new digital era, organizations must connect and protect all that they do. They need to connect the people, places, applications, data, and devices that power their business while protecting their entire digital footprint from cybersecurity threats, downtime, and other critical business risks.

Cisco will bring the full power of the network, together with market-leading security and observability solutions, to deliver a real-time unified view of the entire digital landscape, helping teams proactively defend critical infrastructure, prevent outages, and refine the network experience.

“We are thrilled to officially welcome Splunk to Cisco,” said Chuck Robbins, Chair and CEO of Cisco. “As one of the world’s largest software companies, we will revolutionize the way our customers leverage data to connect and protect every aspect of their organization as we help power and protect the AI revolution.”

“Uniting Splunk and Cisco will bring tremendous value to our joint customers worldwide,” said Gary Steele, Executive Vice President, General Manager, Splunk. “The combination of Cisco and Splunk will provide truly comprehensive visibility and insights across an organization’s entire digital footprint, delivering an unprecedented level of resilience through the most extensive and powerful security and observability product portfolio on the market.”

Cisco will Power and Protect the AI Revolution
The adoption and impact of AI are outpacing that of any technology introduction we have ever seen.

Effective use of the right data at massive scale is critical to enable the meaningful benefits of AI and help organizations drive outcomes never before possible. To truly reap the benefits of AI, organizations need the infrastructure to power it, the data to develop it, a security platform to protect it, and an observability platform to monitor and manage it in real time. Cisco will be able to do all four together.

“Cisco and Splunk is a transformative combination that will allow customers to do things that weren’t possible before,” said Stephen Elliot, Group Vice President, I&O, Cloud Operations, and DevOps at IDC. “With the close, Cisco has created a unique set of solutions for networking, security, and operations executives in the market. When you add that to their channel and AI investments, customers should be considering the higher levels of business value that can now be unlocked.”

“Accenture congratulates Cisco on the acquisition of Splunk,” said Julie Sweet, Chair and CEO Accenture. “We have enjoyed long-term partnerships with both companies and look forward to the opportunities this collaboration presents to our clients in the future.

Better Together: How Cisco and Splunk will Benefit Customers, Partners and Developers
The combination of Cisco and Splunk will provide customers with:

Better Security. A highly comprehensive security solution for threat prevention, detection, investigation, and response for organizations of any size, utilizing cloud, network, and endpoint traffic for unparalleled visibility.

Better Observability. A highly comprehensive full-stack observability solution for delivering amazing digital experiences across a multi-cloud hybrid environment.

Better Networking. A leading secure networking solution delivered on intelligent, resilient, and continually optimized network infrastructure.

Better AI. Cisco’s networking portfolio — combined with enhanced security, full-stack observability, and a comprehensive data platform — empowers customers to securely harness the power of AI throughout their organizations and applications.

Better Economics. Cisco and Splunk’s platform approach will help our customers consolidate numerous point products — delivering better business outcomes and reducing costs.

Cisco and Splunk also bring together global developer and partner communities with extensive experience extending security, observability, and data platform capabilities with pre-packaged applications and solutions for customers. Our collective partner ecosystem can create new profitable revenue streams through high-value services and by deploying innovative new applications and AI-powered solutions.

Over the next several months, customers can expect a number of new product innovations across the portfolio with the integration of Splunk – for additional details please click here. Many of these innovations and more will be showcased at Cisco Live, June 2-4, 2024, and .conf24, June 11-14, 2024.

Transaction Details
Under the terms of the agreement, Cisco acquired Splunk for $157 per share in cash, representing approximately $28 billion in equity value. The transaction is expected to be cash flow positive (excluding certain acquisition related and other items) and non-GAAP gross margin accretive in Cisco’s fiscal year 2025, and non-GAAP EPS accretive in fiscal year 2026. Additionally, it will accelerate Cisco’s revenue growth and non-GAAP gross margin expansion.

Cisco and Splunk notified NASDAQ of the completion of the acquisition and requested that NASDAQ file a notification of delisting with the Securities and Exchange Commission (the “SEC”) on Splunk’s behalf. Splunk’s common stock ceased trading on NASDAQ prior to the opening of trading today.

Other Resources

• Cisco Blog: A New Day for Data
• Chuck Robbins and Gary Steele Video
• Cisco Newsroom
• B-roll
• Media assets

About Cisco
Cisco (NASDAQ: CSCO) is the worldwide technology leader that securely connects everything to make anything possible. Our purpose is to power an inclusive future for all by helping our customers reimagine their applications, power hybrid work, secure their enterprise, transform their infrastructure, and meet their sustainability goals. Discover more on The Newsroom and follow us on Twitter at @Cisco.

Cisco and the Cisco logo are trademarks or registered trademarks of Cisco and/or its affiliates in the U.S. and other countries. A listing of Cisco’s trademarks can be found at www.Cisco.com/go/trademarks. Third-party trademarks mentioned are the property of their respective owners. The use of the word partner does not imply a partnership relationship between Cisco and any other company.

Forward-Looking Statements
This press release may be deemed to contain forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements that are not statements of historical fact (including statements containing the words “will,” “believes,” “plans,” “anticipates,” “expects,” “estimates,” “strives,” “goal,” “intends,” “may,” “endeavors,” “continues,” “projects,” “seeks,” or “targets,” or the negative of these terms or other comparable terminology, as well as similar expressions) should be considered to be forward-looking statements, although not all forward-looking statements contain these identifying words. Readers should not place undue reliance on these forward-looking statements, as these statements are the management’s beliefs and assumptions, many of which, by their nature, are inherently uncertain, and outside of the management’s control.  Forward-looking statements may include statements regarding the expected benefits to Cisco, Splunk and their respective customers from completing the transaction, the integration of Splunk’s and Cisco’s complementary capabilities to create an end-to-end platform designed to unlock greater digital resilience for customers, plans for future investment and capital allocation, the expected financial performance of Cisco following the expected completion of the transaction, and the expected completion of the transaction. Statements regarding future events are based on the parties’ current expectations, estimates and projections and are necessarily subject to associated risks related to, among other things, (i) the completion of the proposed transaction on anticipated terms and timing, including obtaining stockholder and regulatory approvals and other conditions to the completion of the transaction, (ii) the effect of the announcement or pendency of the proposed transaction on Splunk’s business, operating results, and relationships with customers, suppliers, competitors and others, (iii) risks that the proposed transaction may disrupt Splunk’s current plans and business operations, (iv) risks related to the diverting of management’s attention from Splunk’s ongoing business operations, (v) the occurrence of any event, change or other circumstances that could give rise to the termination of the definitive agreement, (vi) the outcome of any legal proceedings related to the transaction, (vii) the potential effects on the accounting of the proposed transaction, (viii) legislative, regulatory and economic developments, (ix) general economic conditions, (x) restrictions during the pendency of the proposed transaction that may impact Splunk’s ability to pursue certain business opportunities or strategic transactions, (xi) the retention of key personnel and (xii) the ability of Cisco to successfully integrate Splunk’s market opportunities, technology, personnel and operations and to achieve expected benefits. Therefore, actual results may differ materially and adversely from the anticipated results or outcomes indicated in any forward-looking statements. For information regarding other related risks, see the “Risk Factors” section of Cisco’s most recent report on Form 10-K filed on September 7, 2023, as well as the “Risk Factors” section of Splunk’s most recent reports on Form 10-Q and Form 10-K filed with the SEC on August 24, 2023, and March 23, 2023, respectively. The parties undertake no obligation to revise or update any forward-looking statements for any reason, except as required by law.

Non-GAAP Information
This press release includes future estimated non-GAAP EPS information. Non-GAAP measures are not in accordance with, or an alternative for, measures prepared in accordance with generally accepted accounting principles (GAAP) and may be different from non-GAAP measures used by other companies. In addition, non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Cisco believes that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with Cisco’s results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Cisco’s results of operations in conjunction with the corresponding GAAP measures. Cisco believes that the presentation of non-GAAP measures provides useful information to investors and management regarding financial and business trends relating to its financial condition and its historical and projected results of operations. We have not reconciled future estimated non-GAAP EPS information included in this presentation to the most directly comparable GAAP measure because this cannot be done without unreasonable effort because we do not currently have sufficient data to accurately estimate the individual adjustments included in the most directly comparable GAAP measure that would be necessary for such reconciliations. We expect the variability of these items to have a potentially unpredictable, and a potentially significant, impact on our future GAAP financial results.

Media contacts:
Will Stickney
Cisco Public Relations
646-573-4532
wstickne@cisco.com
Mara Mort
Splunk Public Relations
(415) 850-8645
press@splunk.com

Investor Contact:
Sami Badri
Cisco Investor Relations
1 (469) 420-4934
sambadri@cisco.com

SOURCE Cisco Systems, Inc.

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Largest US advisory CPA private equity transaction to date recognizes Baker Tilly’s outstanding record of value creation and positions the firm for accelerated growth

CHICAGO, Illinois – Leading advisory CPA firm Baker Tilly US, LLP (“Baker Tilly”) today announces a strategic investment from private equity firms Hellman & Friedman (“H&F”) and Valeas Capital Partners (“Valeas”). The investment, estimated to close in early June 2024, recognizes Baker Tilly’s outstanding track record of value creation and marks the largest private equity investment in the US CPA sector to date.

In the past five years, Baker Tilly has doubled its workforce by expanding its footprint nationally and internationally, securing its position as a top 10 advisory CPA firm in the United States. The significant investment from H&F and Valeas provides the firm with access to additional capital and capabilities to accelerate growth through investments in talent, technology and further strategic acquisitions directed at providing best-in-class client services.

As part of this transaction, the firm will be restructured as two entities: Baker Tilly Advisory Group, LP will provide the firm’s business advisory, tax and other services with Jeff Ferro continuing in his role as CEO. Baker Tilly US, LLP, a licensed CPA firm, will provide the firm’s attest services, with Jere Shawver, Managing Partner – Risk and Assurance, stepping into the new role of CEO. Baker Tilly US, LLP will operate as a separate legal entity pursuant to regulatory and independence requirements. Following the restructuring, both firms will remain partnerships, with all partners holding equity alongside H&F and Valeas in Baker Tilly Advisory Group, LP.

“We are extremely proud to join forces with H&F and Valeas, blue-chip and growth-oriented private equity investors, who support our vision, recognize the value we’ve already created and see our vast future potential,” said Ferro. “With this transaction, the firm will be in an even stronger position to grow and invest in our business to create new opportunities for our talented team members and valued clients.”

“Our investment in Baker Tilly builds on H&F’s long history of successful partnerships in the professional services sector. Baker Tilly has built a remarkable firm with an empowering culture, tremendously talented workforce, and impressive track record of growth through outstanding client service and smart acquisitions,” said Blake Kleinman, Partner at H&F. “We are excited to invest alongside Baker Tilly’s partners and senior leadership to bolster its capabilities, expand its footprint, and, together, help build the country’s preeminent mid-market advisory CPA firm.”

“As a top global brand in accounting, tax and advisory with a strong track record of value creation and growth, Baker Tilly is uniquely positioned to lead the transformation of the industry,” said Ed Woiteshek, Co-Founder and Managing Partner, Valeas. “We look forward to working with Baker Tilly’s leaders to further the firm’s impressive growth trajectory in the years ahead.”

Baker Tilly engaged William Blair & Company, L.L.C. as its financial advisor and Foley & Lardner LLP as its legal counsel on this transaction. Simpson Thacher & Bartlett LLP and Vedder Price PC served as legal advisors to H&F and Ropes & Gray LLP advised Valeas.

About Baker Tilly US, LLP (bakertilly.com)
Baker Tilly US, LLP (Baker Tilly) is a leading advisory CPA firm, providing clients with a genuine coast-to-coast and global advantage in major regions of the U.S. and in many of the world’s leading financial centers – New York, London, San Francisco, Los Angeles and Chicago. Baker Tilly is an independent member of Baker Tilly International, a worldwide network of independent accounting and business advisory firms in 145 territories, with 41,000 professionals and a combined worldwide revenue of $4.7 billion. Visit  bakertilly.com.

About Hellman & Friedman
Hellman & Friedman is a preeminent global private equity firm with a distinctive investment approach focused on large-scale equity investments in high quality growth businesses. H&F seeks to partner with world-class management teams where its deep sector expertise, long-term orientation and collaborative partnership approach enable companies to flourish. H&F targets outstanding businesses in select sectors including software & technology, financial services, healthcare, consumer & retail, and other business services. The firm is currently investing its tenth fund, with over $24 billion of committed capital, and has over $92 billion in assets under management as of September 30, 2023. Learn more about H&F’s defining investment philosophy and approach to sustainable outcomes at www.hf.com. 

About Valeas Capital Partners
Valeas Capital Partners is a San Francisco-based mid-market private equity firm focused on growth-buyout partnerships backing industry leading management teams. Valeas is developing a concentrated portfolio of growth-oriented, tech-enabled businesses in sectors where its team has deep industry expertise. Leveraging the team’s experience as both investors and operators, Valeas seeks to prioritize strong collaboration with portfolio company management teams to create lasting market leaders and value for investors. Valeas focuses on three primary sectors: healthcare, financial services and data & technology. Representative investments include: Sequoia Financial Group, Ren, CINQCare and Well. For more information, visit valeas.com.

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News Summary

• Together, Cisco and Splunk will help move organizations from threat detection and response to threat prediction and prevention
• Combined, Cisco and Splunk will become one of the world’s largest software companies and will accelerate Cisco’s business transformation to more recurring revenue
• Expected to be cash flow positive and gross margin accretive in first fiscal year post close, and non-GAAP EPS accretive in year 2. Will accelerate revenue growth and gross margin expansion
• Unites two “Great Places to Work” with similar values, strong cultures, and talented teams
• The combination of these two innovative leaders makes them well positioned to lead in security and observability in the age of AI

Cisco (NASDAQ: CSCO) and Splunk (NASDAQ: SPLK), the cybersecurity and observability leader, today announced a definitive agreement under which Cisco intends to acquire Splunk for $157 per share in cash, representing approximately $28 billion in equity value. Upon close of the acquisition, Splunk President and CEO Gary Steele will join Cisco’s Executive Leadership Team reporting to Chair and CEO Chuck Robbins.
The acquisition builds on Splunk’s heritage of helping organizations enhance their digital resilience and will accelerate Cisco’s strategy to securely connect everything to make anything possible. The combination of these two established leaders in AI, security and observability will help make organizations more secure and resilient.

“We’re excited to bring Cisco and Splunk together. Our combined capabilities will drive the next generation of AI-enabled security and observability,” said Chuck Robbins, chair and CEO of Cisco. “From threat detection and response to threat prediction and prevention, we will help make organizations of all sizes more secure and resilient.”

“Uniting with Cisco represents the next phase of Splunk’s growth journey, accelerating our mission to help organizations worldwide become more resilient, while delivering immediate and compelling value to our shareholders,” said Gary Steele, president and CEO of Splunk.

“Together, we will form a global security and observability leader that harnesses the power of data and AI to deliver excellent customer outcomes and transform the industry. We’re thrilled to join forces with a long-time and trusted partner that shares our passion for innovation and world-class customer experience, and we expect our community of Splunk employees will benefit from even greater opportunities as we bring together two respected and purpose-driven organizations,” Steele added.

In today’s hyperconnected world, data is everywhere, with every organization relying on it to run their business and make mission-critical decisions every day. Factoring in the acceleration and adoption of generative AI, expanding threat surfaces, and multiple cloud environments, it creates a level of complexity that is unlike anything organizations have faced. Organizations need a better way to manage, protect, and unlock data’s true value and stay digitally resilient.

Together, Cisco and Splunk will address these challenges head on.

The combination of these two established leaders with complementary capabilities in AI, security and observability will unlock the true value of data and will help make organizations of all sizes more secure and digitally resilient.

Specifically, Splunk’s security capabilities complement Cisco’s existing portfolio, and together, will provide leading security analytics and coverage from devices to applications to clouds.

Cisco and Splunk’s complementary capabilities will provide observability across hybrid and multi-cloud environments enabling the company’s customers to deliver smooth application experiences that power their digital businesses. Cisco and Splunk are well positioned to help customers responsibly harness the power of AI given their substantial scale, visibility into data, and foundation of trust.

The union of these two organizations will allow for greater investments in new solutions, accelerated innovation, and increased global scale to support the needs of customers of all sizes.

Cisco’s acquisition of Splunk will also build upon both companies’ reputations for being purpose-driven with similar values, strong cultures, and incredibly talented teams. The acquisition will unite two “Great Places to Work” with a shared passion for innovation and inclusion and will remain a great place to work and the premier place for software talent.

Transaction Details
Under the terms of the agreement, Cisco intends to acquire Splunk for $157 per share in cash, representing approximately $28 billion in equity value. The transaction is expected to be cash flow positive and gross margin accretive in the first fiscal year post close, and non-GAAP EPS accretive in year two. Additionally, it will accelerate Cisco’s revenue growth and gross margin expansion.

The transaction will not impact Cisco’s previously announced share buyback program or dividend program.

The acquisition has been unanimously approved by the boards of directors of both Cisco and Splunk. It is expected to close by the end of the third quarter of calendar year 2024, subject to regulatory approval and other customary closing conditions including approval by Splunk shareholders.

For further information regarding all terms and conditions contained in the definitive agreement, please see Cisco’s Current Report on Form 8-K, which will be filed in connection with the transaction.

Advisors
Tidal Partners LLC is acting as financial advisor to Cisco, Simpson Thacher & Bartlett LLP is acting as legal counsel, and Cravath, Swaine & Moore LLP is acting as regulatory counsel. Qatalyst Partners and Morgan Stanley & Co. LLC are acting as financial advisors to Splunk and Skadden, Arps, Slate, Meagher & Flom LLP is acting as legal counsel.

About Cisco
Cisco (NASDAQ: CSCO) is the worldwide technology leader that securely connects everything to make anything possible. Our purpose is to power an inclusive future for all by helping our customers reimagine their applications, power hybrid work, secure their enterprise, transform their infrastructure, and meet their sustainability goals. Discover more on The Newsroom and follow us on Twitter at @Cisco. Cisco and the Cisco logo are trademarks or registered trademarks of Cisco and/or its affiliates in the U.S. and other countries. A listing of Cisco’s trademarks can be found at www.Cisco.com/go/trademarks. Third-party trademarks mentioned are the property of their respective owners. The use of the word partner does not imply a partnership relationship between Cisco and any other company.

About Splunk
Splunk Inc. (NASDAQ:SPLK) helps build a safer and more resilient digital world. Organizations trust Splunk to prevent security, infrastructure and application issues from becoming major incidents, absorb shocks from digital disruptions, and accelerate digital transformation.

Cisco Forward-Looking Statements
This press release may be deemed to contain forward-looking statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Any statements that are not statements of historical fact (including statements containing the words “will,” “believes,” “plans,” “anticipates,” “expects,” “estimates,” “strives,” “goal,” “intends,” “may,” “endeavors,” “continues,” “projects,” “seeks,” or “targets,” or the negative of these terms or other comparable terminology, as well as similar expressions) should be considered to be forward-looking statements, although not all forward-looking statements contain these identifying words. Readers should not place undue reliance on these forward-looking statements, as these statements are the management’s beliefs and assumptions, many of which, by their nature, are inherently uncertain, and outside of the management’s control.  Forward-looking statements may include statements regarding the expected benefits to Cisco, Splunk and their respective customers from completing the transaction, the integration of Splunk’s and Cisco’s complementary capabilities to create an end-to-end platform designed to unlock greater digital resilience for customers, plans for future investment and capital allocation, the expected financial performance of Cisco following the expected completion of the transaction, and the expected completion of the transaction. Statements regarding future events are based on the parties’ current expectations, estimates and projections and are necessarily subject to associated risks related to, among other things, (i) the completion of the proposed transaction on anticipated terms and timing, including obtaining stockholder and regulatory approvals and other conditions to the completion of the transaction, (ii) the effect of the announcement or pendency of the proposed transaction on Splunk’s business, operating results, and relationships with customers, suppliers, competitors and others, (iii) risks that the proposed transaction may disrupt Splunk’s current plans and business operations, (iv) risks related to the diverting of management’s attention from Splunk’s ongoing business operations, (v) the occurrence of any event, change or other circumstances that could give rise to the termination of the definitive agreement, (vi) the outcome of any legal proceedings related to the transaction, (vii) the potential effects on the accounting of the proposed transaction, (viii) legislative, regulatory and economic developments, (ix) general economic conditions, (x) restrictions during the pendency of the proposed transaction that may impact Splunk’s ability to pursue certain business opportunities or strategic transactions, (xi) the retention of key personnel and (xii) the ability of Cisco to successfully integrate Splunk’s market opportunities, technology, personnel and operations and to achieve expected benefits. Therefore, actual results may differ materially and adversely from the anticipated results or outcomes indicated in any forward-looking statements. For information regarding other related risks, see the “Risk Factors” section of Cisco’s most recent report on Form 10-K filed on September 7, 2023, as well as the “Risk Factors” section of Splunk’s most recent reports on Form 10-Q and Form 10-K filed with the SEC on August 24, 2023, and March 23, 2023, respectively. The parties undertake no obligation to revise or update any forward-looking statements for any reason, except as required by law.

Splunk Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the federal securities laws, including Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements are based on Splunk’s current expectations, estimates and projections about the expected date of closing of the proposed transaction and the potential benefits thereof, its business and industry, management’s beliefs and certain assumptions made by Splunk and Cisco, all of which are subject to change. In this context, forward-looking statements often address expected future business and financial performance and financial condition, and often contain words such as “expect,” “anticipate,” “intend,” “plan,” “believe,” “could,” “seek,” “see,” “will,” “may,” “would,” “might,” “potentially,” “estimate,” “continue,” “expect,” “target,” similar expressions or the negatives of these words or other comparable terminology that convey uncertainty of future events or outcomes. All forward-looking statements by their nature address matters that involve risks and uncertainties, many of which are beyond our control, and are not guarantees of future results, such as statements about the consummation of the proposed transaction and the anticipated benefits thereof. These and other forward-looking statements, including the failure to consummate the proposed transaction or to make or take any filing or other action required to consummate the transaction on a timely matter or at all, are not guarantees of future results and are subject to risks, uncertainties and assumptions that could cause actual results to differ materially from those expressed in any forward-looking statements. Accordingly, there are or will be important factors that could cause actual results to differ materially from those indicated in such statements and, therefore, you should not place undue reliance on any such statements and caution must be exercised in relying on forward-looking statements. Important risk factors that may cause such a difference include, but are not limited to: (i) the completion of the proposed transaction on anticipated terms and timing, including obtaining shareholder and regulatory approvals, anticipated tax treatment, unforeseen liabilities, future capital expenditures, revenues, expenses, earnings, synergies, economic performance, indebtedness, financial condition, losses, future prospects, business and management strategies for the management, expansion and growth of Splunk’s business and other conditions to the completion of the transaction; (ii) the impact of the COVID-19 pandemic on Splunk’s business and general economic conditions; (iii) Splunk’s ability to implement its business strategy; (iv) significant transaction costs associated with the proposed transaction; (v) potential litigation relating to the proposed transaction; (vi) the risk that disruptions from the proposed transaction will harm Splunk’s business, including current plans and operations; (vii) the ability of Splunk to retain and hire key personnel; (viii) potential adverse reactions or changes to business relationships resulting from the announcement or completion of the proposed transaction; (ix) legislative, regulatory and economic developments affecting Splunk’s business; (x) general economic and market developments and conditions; (xi) the evolving legal, regulatory and tax regimes under which Splunk operates; (xii) potential business uncertainty, including changes to existing business relationships, during the pendency of the merger that could affect Splunk’s financial performance; (xiii) restrictions during the pendency of the proposed transaction that may impact Splunk’s ability to pursue certain business opportunities or strategic transactions; and (xiv) unpredictability and severity of catastrophic events, including, but not limited to, acts of terrorism or outbreak of war or hostilities, as well as Splunk’s response to any of the aforementioned factors. These risks, as well as other risks associated with the proposed transaction, are more fully discussed in the proxy statement to be filed with the U.S. Securities and Exchange Commission in connection with the proposed transaction. While the list of factors presented here is, and the list of factors presented in the proxy statement will be, considered representative, no such list should be considered to be a complete statement of all potential risks and uncertainties. Unlisted factors may present significant additional obstacles to the realization of forward looking statements. Consequences of material differences in results as compared with those anticipated in the forward-looking statements could include, among other things, business disruption, operational problems, financial loss, legal liability to third parties and similar risks, any of which could have a material adverse effect on Splunk’s financial condition, results of operations, or liquidity. Splunk does not assume any obligation to publicly provide revisions or updates to any forward-looking statements, whether as a result of new information, future developments or otherwise, should circumstances change, except as otherwise required by securities and other applicable laws.

Non-GAAP Information
This press release includes future estimated non-GAAP EPS information. Non-GAAP measures are not in accordance with, or an alternative for, measures prepared in accordance with generally accepted accounting principles (GAAP) and may be different from non-GAAP measures used by other companies. In addition, non-GAAP measures are not based on any comprehensive set of accounting rules or principles. Cisco believes that non-GAAP measures have limitations in that they do not reflect all of the amounts associated with Cisco’s results of operations as determined in accordance with GAAP and that these measures should only be used to evaluate Cisco’s results of operations in conjunction with the corresponding GAAP measures. Cisco believes that the presentation of non-GAAP measures provides useful information to investors and management regarding financial and business trends relating to its financial condition and its historical and projected results of operations. We have not reconciled future estimated non-GAAP EPS information included in this presentation to the most directly comparable GAAP measure because this cannot be done without unreasonable effort because we do not currently have sufficient data to accurately estimate the individual adjustments included in the most directly comparable GAAP measure that would be necessary for such reconciliations. We expect the variability of these items to have a potentially unpredictable, and a potentially significant, impact on our future GAAP financial results.

Additional Information and Where to Find It
In connection with the proposed transaction and required stockholder approval, Splunk will file with the SEC a preliminary proxy statement and a definitive proxy statement. The proxy statement will be mailed to the stockholders of Splunk. Splunk’s stockholders are urged to carefully read the proxy statement (including all amendments, supplements and any documents incorporated by reference therein) and other relevant materials filed or to be filed with the SEC and in their entirety when they become available because they will contain important information about the proposed transaction and the parties to the transaction. Investors may obtain free copies of these documents (when they are available) and other documents filed with the SEC at its website at www.sec.gov. In addition, investors may obtain free copies of the documents filed with the SEC by Splunk by going to Splunk’s Investor Relations page on its corporate website at https://investors.splunk.com or by contacting Splunk Investor Relations at ir@splunk.com.

Participants in the Solicitation
Splunk and its executive officers and directors may be deemed to be participants in the solicitation of proxies from Splunk’s stockholders with respect to the transaction. Information about Splunk’s directors and executive officers, including their ownership of Splunk securities, is set forth in the proxy statement for Splunk’s 2023 Annual Meeting of Stockholders, which was filed with the SEC on May 9, 2023, Form 8- K filed with the SEC on September 21, 2023, and Splunk’s other filings with the SEC. Investors may obtain more detailed information regarding the direct and indirect interests of Splunk and its respective executive officers and directors in the transaction, which may be different than those of Splunk stockholders generally, by reading the preliminary and definitive proxy statements regarding the transaction, which will be filed with the SEC. In addition, Cisco and its executive officers and directors may be deemed to have participated in the solicitation of proxies from Splunk’s stockholders in favor of the approval of the transaction. Information concerning Cisco’s directors and executive officers is set forth in Cisco’s proxy statement for its 2022 Annual Meeting of Stockholders, which was filed with the SEC on October 18, 2022, annual report on Form 10-K filed with the SEC on September 7, 2023, Forms 8-K filed with the SEC on February 21, 2023, July 19, 2023, and September 21, 2023, and Cisco’s other filings with the SEC. These documents are available free of charge at the SEC’s website at www.sec.gov or by going to Cisco’s Investor Relations website at https://investor.cisco.com.

Media contacts:
Robyn Blum
Cisco Public Relations
408-930-8548
rojenkin@cisco.com
Mara Mort
Splunk Public Relations
(415) 850-8645
press@splunk.com

Investor Relations contacts:
Marilyn Mora
Cisco Investor Relations
1 (408) 527-7452
marilmor@cisco.com
Splunk Investor Relations
ir@splunk.com

SOURCE Cisco Systems, Inc.

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