SAP-controlled Qualtrics accepts buyout offer from Silver Lake, CPPIB

Qualtrics International Inc said on Monday it would be taken private after its controlling shareholder, SAP SE, accepted a $12.5 billion bid from a consortium led by Silver Lake and Canada Pension Plan Investment Board.

Shares of the customer survey software maker were up 6.6% to $17.65 in afternoon trading.

SAP agreed to the offer, of $18.15 per share, and said it would get about $7.7 billion for its stake.

The deal, the year’s biggest private equity-led buyout, comes after German software giant SAP decided that the offer was the best it could secure, Reuters was first to report on Sunday.

Silver Lake and CPPIB have committed to funding the entire deal themselves, if necessary, without borrowing against Qualtrics, as is customary in private equity deals of this size, according to a regulatory filing. While they could add debt to the deal later to juice returns, the move reflects how debt has become scarcer and more expensive amid high interest rates and concerns about a potential economic downturn.

Qualtrics said earlier this month it would negotiate on an exclusive basis with Silver Lake and CPPIB until March 15 to see whether a deal could be finalized.

Silver Lake, whose portfolio consists mostly of technology companies, currently holds a 4.1% stake in Qualtrics.

In 2018, SAP bought Qualtrics for $8 billion and three years later listed it in New York.

Videogame software developer Unity Software (U.N) and Alphabet Inc’s self-driving technology firm Waymo are among the companies in Silver Lake’s portfolio. Reuters