US-based private equity firm Thoma Bravo has agreed to buy UK-based cyber security company Darktrace in all-cash transaction USD 5.3 billion deal. According to the announcement, the boards of directors of both companies have endorsed the deal but shareholders will have to approve it.

Shares in Darktrace firm increased over 19 percent following the news. According to the terms of the acquisition, each Darktrace shareholder will receive USD 7.75 for every share they own, marking a significant premium compared to Darktrace’s recent stock performance. This premium amounts to a 44.3% increase over the three-month average share price before the announcement.

Darktrace's board is of the opinion that the company's operational and financial successes haven't been adequately reflected in its valuation, with its shares trading at a notable discount compared to its global peers. They see the acquisition offer as a chance for shareholders to finally receive fair value for their shares in cash. Officials from Darktrace commented that the proposed offer represents an attractive premium and an opportunity for shareholders to receive the certainty of a cash consideration at a fair value for their shares.

Moreover, the proposed acquisition is expected to provide Darktrace access to a strong financial partner in Thoma Bravo, with deep software sector expertise, which can enhance the company’s position. Thoma Bravo saw the acquisition as an opportunity to deepen its exposure in the cybersecurity market and to support Darktrace's continued growth and innovation. The acquisition is expected to be completed during the third or fourth quarter of 2024.

Background of Darktrace Darktrace is known for its AI-driven threat detection capabilities, leveraging machine learning to detect abnormal network behaviour, including ransomware attacks, insider threats, and data breaches. Among its clientele names such as Allianz, Airbus, and the city of Las Vegas. Following a venture capital fundraising round totalling USD 230 million and achieving a private valuation of USD 1.65 billion, Darktrace went public on the London Stock Exchange in 2021, reaching an opening-day valuation of USD 2.4 billion.

With Thoma Bravo's offer, Darktrace's total valuation stands at USD 5.3 billion on a fully diluted basis, which considers all convertible securities, providing a comprehensive assessment of the company's worth. However, the enterprise value in this context amounts to approximately USD 4.9 billion factoring in additional elements such as debt and cash positions. .