Shares of Qualtrics (NASDAQ: XM) were up in pre-market trading on Monday as the provider of experience management (XM) software announced that it will be acquired by Silver Lake, a technology investment company, in partnership with Canada Pension Plan Investment Board (CPP Investments), in an all-cash transaction for around $12.5 billion.
As per the terms of the agreement, SAP has agreed to sell all of its 423 million shares of Qualtrics as part of this acquisition for a purchase price of $18.15 in cash per share. This represents a premium of 73% to the 30-day volume-weighted average price on January 25 the last full trading day prior to SAP’s announcement to explore a sale of its stake in Qualtrics, and a 62% premium relative to the unaffected closing price on January 25, 2023. SAP acquired Qualtrics in 2019 and had a 71% stake in the company.
The transaction is expected to close in the second half of this year. It will be “fully financed by equity commitments from Silver Lake and co-investors together with $1.75 billion in equity from CPP Investments and $1 billion in debt.”
Analysts are cautiously optimistic about XM stock with a Moderate Buy consensus rating based on seven Buys and eight Holds.