The Wall Street Journal is reporting that Sciquest (SQI) has agreed to be taken private by Accel-KKR for $17.75 per share or about $509 million. This represents a 34% premium to the stock’s closing price on Friday. According to the WSJ, “SciQuest’s board approved the deal, which is expected to close in the third quarter. Under the agreement, the company may solicit competing bids during a 25-day “go-shop” period.” The stock is trading right now at $17.60. The company is a provider of e-procurement technology to the life sciences, state and local and higher education communities.
Public -Private- Public- Private
The deal was not a surprise to industry followers. Teh company’s stock has languished recently and I (and many others) speculated that Sciquest might be a go-private candidate. See here and here. After all, SQI had been public before and gone private, so this represents the second time around. Accel-KKR, the buyer, already owned some shares of the company and understands businesses like this quite well (see here).
The premium Accel-KKR is paying is a reasonable one relative to the recent trading range, but as you can see it is inline with historical prices and well below Sciquest’s peaks –and especially relative to the bubble era. For those of you who are B2B historians, it is interesting to remember that Trinity Ventures took Sciquest private at a $25 million valuation, which represented a 50% premium to the stock price in 2004. Here are two charts of the history of SQI’s stock price during the first public period (’99-’04) in which it declined from $600 to $4 and from 2010 when it when public again in 2010. As you can see the great investor in this story, so far, was Trinity Ventures (Tim McAdam). It will be interesting to see what Accel-KKR does with the company.
Sciquest Stock Price (1999-2004)
Sciquest Stock Price (2010-Present)