Dun & Bradstreet the latest software company to go private in $5.38bn deal

D&B sale follows strategy review of 177-year-old company

Data analytics company Dun & Bradstreet is the latest software vendor to be taken private, with the 177-year-old company agreeing a $5.38 billion deal with a consortium of private equity companies.

The company announced the deal overnight. The investor group is being led by CC Capital, Cannae Holdings and Thomas H. Lee Partners, and what has been described as "a group of other distinguished investors".

The deal is valued in total at $6.9 billion, including Dun & Bradstreet's $1.5 billion of net debt and its net pension obligations. Shareholders will receive $145 in cash for each share they own, against a stock price of $111.63 on 12 February - the last day of trading before the company announced a strategic review, which explicitly included the consideration of a sale.

"Today's announcement is the culmination of a thoughtful and comprehensive review of the value creation opportunities available to the company as part of a full portfolio and business assessment and exploration of strategic alternatives with multiple financial sponsors.

"As a result of this process, the Dun & Bradstreet board of directors unanimously determined that this all-cash transaction with the investor group is in the best interest of our shareholders and our company," said Thomas Manning, who will remain as CEO until the transaction is completed.

William Foley, chairman of Cannae Holdings, justified the deal claiming that Dun & Bradstreet's data-driven business will prosper in "an increasingly data-driven world".

He continued: "We are excited to grow the Company, increase operating efficiencies and improve the Dun & Bradstreet customer experience by providing enhanced business solutions."

The consortium will finance the deal via a combination of equity financing from the private equity companies and debt financing from Bank of America Merrill Lynch, Citigroup and RBC Capital Markets.

However, the deal could potentially be hijacked by any other interested party, with Dun & Bradstreet given a 45-day "go-shop" window in which it can solicit alternative offers, while the private equity group conduct due diligence.

Dun & Bradstreet dates back to 1841 when Lewis Tappan - the great grand nephew of Benjamin Franklin - set-up a business to provide credit information across the US via a network of reporters, just five years after the first commercial telegraphs were introduced.

The company's name, though, was formed via the 1933 merger of Tappan's company, which had become known as R.G. Dun & Company, and a rival founded in 1849, called John M. Bradstreet Company.

The company has employed four US presidents as reporters: Abraham Lincoln, Ulysses S. Grant, Grover Cleveland and William McKinley.

Latterly, the company has acquired a series of software and analytics companies in order to better commercialise its information, and to help customers in their analysis of the data. Acquisitions in recent years include data management company NetProspex and Avention.

In recent years, companies such as BMC Software, Compuware, Tibco and Riverbed Technologies have been acquired by private equity, while ERP software vendor Infor has received a major investment from Koch Equity.