EngageSmart (NYSE: ESMT) surged in trading on Monday after the customer engagement software company announced that it was going private and would be acquired by an affiliate of Vista Equity Partners. Vista Equity is a global investment firm and will acquire EngageSmart in an all-cash transaction valued at around $4 billion.
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According to the terms of the agreement, EngageSmart stockholders will receive $23 per share in cash after completion of the acquisition. The purchase price indicates a premium of around 23% to the closing price of EngageSmart’s common stock on October 4 and a premium of around 30% over the volume weighted average price (VWAP) of the company’s common stock for the 30 days ending October 4.
Following the close of the acquisition, Vista will hold around 65% of ESMT, and affiliates of General Atlantic, a global investor, will hold the remaining 35%. The acquisition of EngageSmart is expected to close in the first quarter of next year.
The company is expected to announce its Q3 earnings on November 2.
What is ESMT’s Price Target?
Analysts are bullish about ESMT stock with a Strong Buy consensus rating based on three Buys and one Hold. The average ESMT price target is $24.50, implying an upside potential of 8.65% from current levels.
