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Ultimate Software To Be Taken Private By H&F-led Group For $11 Bln; Stock Rises

Ultimate Software Group Inc. (ULTI), a provider of human capital management or HCM solutions in the cloud, said Monday that it has agreed to be acquired by an investor group led by private equity firm Hellman & Friedman or H&F, for $331.50 per share in cash. The company's shares are gaining more than 17 percent in pre-market activity.

The transaction represents an aggregate value of about $11 billion, after which Ultimate Software will operate as a privately held company. The transaction is expected to close in mid-2019.

Under the terms of the agreement, all Ultimate stockholders of record will receive $331.50 in cash for each share of Ultimate's common stock held by them upon the closing of the transaction. This price represents a nearly 32 percent premium over Ultimate's volume-weighted average price during the 30 trading days ending February 1, 2019, and a premium to Ultimate's all-time high closing share price.

Ultimate said its Board of Directors has unanimously approved this transaction and recommended that stockholders vote in favor of the transaction.

Upon completion of the transaction, Ultimate will continue to operate under the leadership of CEO Scott Scherr and the existing senior management team.

The privately-held company will be owned by an investor group led by Hellman & Friedman in partnership with significant investors Blackstone, GIC, and Canada Pension Plan Investment Board or CPPIB, and other investors including JMI Equity.

The company noted that the definitive agreement for the transaction includes a 50-day "go-shop" period that permits Ultimate Software's Board of Directors and financial advisor to actively initiate, solicit, and encourage alternative acquisition proposals, and potentially enter negotiations with other parties that make alternative acquisition proposals.

Ultimate Software will have the right to terminate the merger agreement to accept a superior proposal subject to the terms and conditions of the merger agreement.

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