Avalara, a publicly-traded Seattle tax software company founded in 2004, is going private again in a $8.4 billion deal with Vista Equity Partners.
Vista, a global investment firm based in Austin that manages $96 billion in assets, will acquire all outstanding shares of Avalara common stock for $93.50 per share. Shares of Avalara opened Monday at $92/share, and were down 3% in early trading.
A press release noted that the purchase prices represents a 27% premium over Avalara’s share price on July 6, a deal before media reports emerged about a potential transaction.
The deal represents another big milestone for Avalara, which has more than 30,000 customers that use its compliance automation software to manage their sales and other types of taxes. Customers include Zillow Group, Pinterest, and others.
The company’s stock is down nearly 30% this year amid the broader public market downturn.
The deal is the latest example of private equity firms hungry for public company acquisitions at bargain prices.
Avalara reported second quarter financials Monday, showing revenue of $208.6 million, up 23% from the year-ago period, and up 2% from the first quarter. GAAP net loss came in at $55.8 million, up from $31 million last year.
“Despite ongoing macro uncertainties, we believe Avalara is a durable, diversified, and resilient business, and that we are in the early days of addressing a huge market to automate compliance for businesses of all sizes,” CEO Scott McFarlane said in a statement.
The company has been on an acquisition spree of its own lately, swooping up a group of smaller tax-related software providers.
Avalara went public in 2018, pricing shares at $24 each. McFarlane co-founded Avalara 14 years ago with Rory Rawlings and Jared Vogt on Bainbridge Island, Wash.
Avalara employs 700 people in the Seattle area, and more than 4,400 worldwide.
The deal with Vista is expected to close in the second half of 2022, subject to approval from regulators and Avalara shareholders. Avalara will continue operating under the same brand.
Vista paid $1.9 billion in 2019 to acquire Bellevue, Wash.-based Apptio, another public enterprise software company.