0
0
Squarespace to Go Private in $6.9B Transaction with Permira
Squarespace, the New York-based website-building platform, experienced a remarkable surge in stock value, up by 13% at market opening following the announcement of its intention to transition to private ownership through an acquisition by the private equity firm, Permira.
Acquisition Details
The acquisition deal, valued at $6.9 billion in an all-cash transaction, positioned Squarespace stockholders to receive $44.00 per share in cash as part of the agreement. This purchase price represented a premium of approximately 29% over Squarespace’s 90-day volume weighted average trading price and 15% over the company’s closing share price of $38.19 as of the previous Friday.
With a market capitalization of $5.94 billion, Squarespace will transition into a privately held entity upon the completion of the transaction. The move aims to provide the company with enhanced flexibility and resources to invest in empowering entrepreneurs in developing stronger online brands and engaging more seamlessly with their customer base.
Company Leadership
Squarespace originally went public on the New York Stock Exchange in May 2021. Founder Anthony Casalena, who established the startup in 2003, will continue to serve as the company’s CEO even after its transition to private ownership. Additionally, Casalena is expected to retain the majority of his existing equity stake, solidifying his status as one of the largest shareholders within Squarespace.
Notably, Casalena, along with long-standing investors General Atlantic and Accel, collectively possess about 90% of Squarespace’s voting shares. This consolidated ownership structure underscores the commitment of key stakeholders to the long-term success and strategic direction of the company.
Financial Performance and Outlook
Recently, Squarespace disclosed its first-quarter earnings report, revealing a 19% growth in revenue and a 23% increase in bookings year-over-year. However, net income experienced a decline to $0.1 million, as compared to $0.5 million in the corresponding period of 2023. Despite this, Casalena remains optimistic about the company’s future prospects, citing significant opportunities for sustained growth and improved profitability.
Following the acquisition agreement, Squarespace made the decision to cancel its annual Investor Day event, originally slated for the upcoming week. The finalization of the transaction is anticipated to occur by the fourth quarter of 2024, marking a pivotal moment in Squarespace’s corporate evolution.
Image/Photo credit: source url
