Kape Technologies acquires ExpressVPN, Intuit buys Mailchimp
ExpressVPN deal is one of the largest acquisitions by a UK technology company in recent years, while Intuit snaps up SME marketing platform for $12 billion
London-listed software provider Kape Technologies announced on Monday that it has inked a deal to acquire virtual private network (VPN) provider ExpressVPN for $936 million (about £675 million).
As part of the deal, billionaire Teddy Sagi's Kape will pay $354 million (about £255 million) in cash and the equivalent of $237 million (about £171 million) in shares, when the deal closes. Another $345 million (about £249 million) in cash will be paid in two instalments.
According to Kape, the deal will enable the company to expand its cybersecurity tools for private web surfing.
It is aimed at creating a "premium consumer privacy and security player" and will enable Kape to more than double its customer base, from nearly 3 million customers to more than 6 million.
ExpressVPN is one of the better known providers of the VPN technology that enables users to connect to the internet in a private and secure manner.
The company is based in the British Virgin Islands, and was co-founded by Dan Pomerantz and Peter Burchhardt in 2009. It was the first company to launch servers that erase all the content when they are restarted.
ExpressVPN currently has about three million paying subscribers, 40 per cent of which are based in North America.
In 2020, the company's revenue increased 37 per cent to $279 million.
According to Kape, ExpressVPN will continue to operate as an independent service after completion of the deal.
Both executives, as well as the other team members, will stay with the firm, and its jurisdiction will remain in the British Virgin Islands.
Moreover, the firm will continue to uphold its policy of not logging user web traffic after the deal closes.
"Controlling one's digital presence is at the forefront of every tech consumer's mind now, and Kape is more committed than ever to innovating and delivering the tools internet users need to protect their data and rights," said Ido Erlichman, chief executive of Kape Technologies.
Dan Pomerantz, co-founder of ExpressVPN, stated that their team is "delighted to be joining the Kape Technologies family," which will enable them to have access to greater capital and resources.
"It was essential to us that anyone we teamed up with shared our strong fundamental commitment to user privacy, and Kape has demonstrated that in spades through its family of brands," he added.
The ExpressVPN deal is one of the largest by a UK technology company in recent years and is the the latest in a series of acquisitions by Kape Technologies.
In October 2018, Kape acquired ZenMate, a VPN service provider owned by the internet security company ZenGuard.
The next year, it announced takeover of Colorado-based LTMI Holdings for $127.6 million.
Earlier this year, Kape said that it was buying Webselenese - an online platform specialising in consumer-focused privacy and security content - in a deal worth $149.1 million.
Intuit buys Mailchimp
In more acquisition news, Intuit, which is best known for its accountancy software QuickBooks, announced on Monday that it is to buy Mailchimp, the email and marketing platform aimed at small and medium-sized businesses. The planned acquisition values Mailchimp at around $12 billion, which will be paid in cash and stocks.
The acquisition is the latest by move Intuit, which is building end-to-end customer-centric platform for SMEs, encompassing aspects of CRM, analytics, payroll, financials and compliance.
"We're focused on powering prosperity around the world for consumers and small businesses," said Intuit CEO Sasan Goodarzi.
"Together, Mailchimp and QuickBooks will help solve small and mid-market businesses' biggest barriers to growth, getting and retaining customers. Expanding our platform to be at the centre of small and mid-market business growth helps them overcome their most important financial challenges.
"Adding Mailchimp furthers our vision to provide an end-to-end customer growth platform to help our customers grow and run their businesses, putting the power of data in their hands to thrive."