KKR, Francisco Partners vying to acquire Instructure, sources say
Adds background on Instructure from paragraph 5 onwards
By Milana Vinn
July 3 (Reuters) -Private equity firms KKR KKR.N and Francisco Partners are competing to acquire Instructure INST.N, a U.S. education software provider with a market value of $3.4 billion, people familiar with the matter said on Wednesday.
The two buyout firms are through to the final round of bidding for Instructure and are preparing to submit binding offers next week, the sources said.
There is no certainty that private equity firm Thoma Bravo, which holds an 83% stake in Instructure, will agree to sell it, and other bidders could emerge, the sources added, requesting anonymity because the matter is confidential.
Instructure, KKR, Francisco Partners and Thoma Bravo declined to comment.
Based in Salt Lake City, Instructure provides software to schools, colleges and universities. It has over 8,000 customers in more than 100 countries.
The company's flagship learning management system is called Canvas and competes with programs such as Google Classroom, Blackboard Learn and Schoology.
Thoma Bravo took Instructure private in 2020 for $2 billion before returning it to the stock market a year later through an initial public offering (IPO).
Instructure's shares are hovering just a little over their $20 IPO price three years later, as a boom the company enjoyed from spending on remote learning during the COVID-19 pandemic fizzled when competition from rivals intensified.
Earlier this year, Instructure completed the acquisition of academic credential management platform Parchment for $835 million. Reuters reported in May that Thoma Bravo had put Instructure up for sale.
PowerSchool Holdings PWSC.N, another educational software vendor, agreed to be acquired by private equity firm Bain Capital last month for $5.6 billion.
The deal price was equivalent to 7 times PowerSchool's projected 12-month revenue, within the 7-11 times multiple range across recent deals in the sector, according to Jefferies analysts. Instructure currently trades at 6 times 12-month projected revenue, according to LSEG data.
Reporting by Milana Vinn in New York; Editing by Greg Roumeliotis and Sonali Paul
Related Assets
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
