Thoma Bravo aims to reduce risk of cyberattacks with $6.9bn deal; TPG talks healthcare

Good morning, Hubsters. MK Flynn here with today’s Wire and a big deal to kick off the week.

Not surprisingly, it’s all about reducing the risk of cyberattacks at corporations.
Mega Merger Monday. Thoma Bravo is buying SailPoint Technologies, which develops enterprise identity security software, in a take-private all-cash transaction worth $6.9 billion.

“Identity security is core to cybersecurity, and businesses have realized that to fuel business growth and success, they must start with identity as the foundation for secure business transformation,” said Mark McClain, the CEO and founder of SailPoint. “The transaction will also allow us to pursue our long-term growth trajectory with greater flexibility and effectiveness to support our customers, expand our markets, and accelerate innovation in identity security with the backing of a strong financial partner with deep sector expertise.”

“SailPoint is ideally positioned to capitalize on the large and growing demand from modern enterprises for robust identity security solutions that secure their business and reduce risk,” said Seth Boro, a managing partner at Thoma Bravo. “Their market-leading identity security platform provides the autonomous and intelligent approach that the market requires today, especially among larger enterprises and as hybrid working becomes more common.”

A few big take-private deals were announced in the first quarter. In March, Thoma Bravo announced the acquisition of Anaplan, a developer of business plan software, in a $10.7 billion take-private deal. It was the first mega deal unveiled after Russia invaded Ukraine. Others announced this year were Elliott Management and Brookfield’s buying TV ratings company Nielsen for $16 billion in March and the take-private of Citrix for $16.5 billion by Elliott and Vista Equity Partners in January.

Healthcare investing. “Innovation and efficiency are the key factors propelling our $3.6 trillion US healthcare system,” Jeff Rhodes, co-managing partner at TPG Capital, told PE Hub. “Capital formation is happening around true innovation in healthcare products that benefits patients and takes costs out of the system. We are also seeing very significant innovation on the healthcare services side around how care is provided, where it’s provided and how it’s paid for. True innovation is rewarded, and that is always where we have invested as a firm, and it’s where we continue to invest.”

Aaron spoke to Rhodes as part of our ongoing series profiling private equity firms investing in healthcare. With the firm since 2005, Rhodes is based in San Francisco and co-leads the healthcare group and the firm’s investment activities in the healthcare services, pharmaceutical and medical device sectors.

“The level of technology adoption and penetration in healthcare is far below other highly regulated industries, and this creates opportunities for greater efficiency, especially in cutting-edge technology around data and analytics that can help make better choices more quickly,” Rhodes said. “As healthcare has become a larger percent of gross domestic product, the industry knows it can’t just continue to operate in the same way it’s been running. Demand for greater efficiency is leading to more adoption of technology and it’s creating meaningful change.”

The covid era has accelerated trends that began before the pandemic.

“Patients have become more like consumers, and they expect the same type of consumer experience they get in other industries,” Rhodes said.

Read Aaron’s full interview here.

Food for thought: “Do PE firms formed by industry experts still need PE talent? Are we on the cusp of seeing a crop of firms built and led solely by operators, with no investment talent?” Those are some of the questions Chris poses in an analysis piece for Buyouts. Check it out here.

That’s plenty to digest on a Monday morning!

Until tomorrow,
MK