A private equity consortium comprising Insight Partners and Clearlake Capital Group is currently engaged in advanced negotiations to take the data analytics software company Alteryx Inc (NYSE:AYX) private for roughly $5 billion, including debt, Reuters reports.
This move follows Alteryx facing intense competition from tech giants like Microsoft Corp (NASDAQ:MSFT) and Oracle Corp (NYSE:ORCL), coupled with challenges in securing new business, resulting in a depreciation of its valuation and positioning it as an acquisition target.
Citing the sources, Reuters highlighted that Insight and Clearlake are discussing a cash offer of over $50 per share for Alteryx.
This potential deal would present a premium exceeding 65% based on Alteryx’s share price on September 5, marking the last trading day before reports surfaced about Alteryx exploring a sale.
Despite the progress, there remains the possibility of competition from Symphony Technology Group, another private equity entity, making a bid for Alteryx, according to Reuters.
The potential acquisition leaves uncertainties regarding the role of Alteryx’s Co-founder and Executive Chair, Dean Stoecker, who possesses an 11.5% stake in the company.
However, he controls the company through dual-class shares, granting him 51% of all outstanding shares’ voting power, raising questions about his involvement or stake in the deal, the report said.
The company has transitioned to a subscription-focused business model, aligning with the increasing demand for data analytics services in recent years. Notably, Insight Partners, an early investor in Alteryx, maintains a 1.5% stake in the company and has a representation on its board of directors.
Price Action: AYX shares are up 1.63% at $48.60 during the premarket session on the last check Friday.
