Chicago Private Equity Firm Thoma Bravo Buying Deltek for $1.1 Billion

Chicago private equity firm Thoma Bravo, LLC has reached a deal to acquire Deltek, Inc., a leading global provider of enterprise software and information solutions for professional services firms and government contractors, in an all-cash transaction valued at approximately $1.1 billion.

Thoma Bravo is one of the two private-equity firms that spun out of Chicago-based buyout pioneer Golder Thoma & Co. It is a leading private equity investment firm building on a 30+ year history of providing equity and strategic support to experienced management teams and growing companies. The firm has continued to apply the concept of industry consolidation investing, which seeks to create value through the strategic use of acquisitions to accelerate business growth.

Thoma Bravo invests across multiple industries, with a particular focus in enterprise and infrastructure software and financial and business services, and works in partnership with management to implement its operating and consolidation expertise to build long-term value. The firm currently manages a series of private equity funds representing almost $4 billion of equity commitments.  In software, Thoma Bravo has completed 54 add-on acquisitions across 23 platform companies with total annual earnings of approximately $1 billion.

Deltek’s stockholders will receive $13 in cash for each share of Deltek stock when the transaction closes.  The $13 per share offer price represents a 7% discount to Deltek’s stock price on August 24, 2012 and a 24% premium over Deltek’s stock price on June 11, 2012 – the day before Deltek released information on the sales process to interested parties and their respective advisors on a confidential basis. The price represents a 14.6x multiple of enterprise value to Deltek’s trailing twelve months adjusted EBITDA as of June 30, 2012.

Deltek’s Board of Directors unanimously approved the definitive agreement for Deltek to be acquired by Thoma Bravo.  Deltek’s largest shareholder, New Mountain Capital, has consented in favor of the acquisition. New Mountain Capital consented to the acquisition and holds 100% of Deltek’s Class A stock and 59.5% of the Company’s common stock.  No further approval of Deltek’s stockholders is required to approve the transaction.  An information statement will be mailed to the stockholders. 

The transaction is anticipated to close during the fourth quarter of 2012. After the acquisition closes, Deltek will remain headquartered in Herndon, VA and will continue to be led by its existing senior management team.  Deltek will also become a privately held company and its stock will no longer trade on the NASDAQ following the acquisition’s close.

Jefferies & Company, Inc. served as lead financial advisor to Thoma Bravo, and Jefferies Finance LLC and RBC Capital Markets provided financing commitments to the firm. Kirkland & Ellis LLP served as legal advisor to Thoma Bravo.