Thoma Bravo to Acquire QAD for $87.50 Per Share in Cash

QAD Inc. (QADA) has agreed to be acquired by private equity firm Thoma Bravo for $87.50 per share of Class A or Class B common stock in cash. The purchase price represents a 20% premium to the last closing price of the Class A shares prior to the announcement of the transaction and equates to an equity value of approximately $2 billion. On a TTM basis, the deal price values QADA at 5.9x sales and 56x adjusted EBITDA, and based on consensus estimates for FY ’22, implies EV/Sales and EV/EBITDA multiples of 5.5x and 52x. Founder and President Pamela Lopker, who owns common stock equivalent to 67% of the voting power of QAD’s outstanding shares and is expected to retain a significant interest in the company post-transaction, has agreed to vote in favor of the deal, which is expected to close in Q4 ’21. Our price target, which was previously based on a FY ’23 EV/Sales multiple of 4x, increases from $77.00 to $87.50 to match the deal price.

Our report with model and disclosures is available here.