Anirban Sen and Priyanka G
(Reuters) – Buyout firm Bain Capital is in talks to take education software provider PowerSchool private, people familiar with the matter said on Wednesday.
The deal is still weeks away from being signed, but PowerSchool is likely to be valued at around $20 a share, said the people, who requested anonymity because the negotiations are confidential.
A deal at this price would value Power School at about $6 billion, including debt, according to Reuters calculations.
Shares of PowerSchool, which has a market capitalization of about $4.1 billion, rose as much as 27% in morning trading Wednesday after the Wall Street Journal reported on the company's talks with Bain.
Power School acquisitions slowed last year as high interest rates made debt financing for leveraged buyouts expensive, but the move comes at a time when private equity-led buyouts are showing signs of picking up. It will be held on.
Earlier this week, a private equity consortium led by Clearlake Capital and Francisco Partners agreed to buy the software integrity division of chip design company Synopsys for $2.1 billion.
Headquartered in Folsom, California, PowerSchool provides cloud-based software for K-12 education in North America. The program was unofficially started in 1983 when his teenager Greg Porter developed record-keeping software in high school. The California school paid Porter and his friend his $350 for this program.
Fourteen years later, Porter sold the first version of the PowerSchool Student Information System. In 2001 he was acquired by Apple, but ownership changed hands again in 2006 to Pearson.
Private equity firm Vista Equity Partners acquired the company in 2015, and acquisition firm Onex invested in the company a few years later. Both companies still hold significant stakes in PowerSchool, which went public in New York in 2021.
According to the company's website, the company currently has customers in more than 90 countries and its software is used by more than 50 million students worldwide.
(Reporting by Priyanka G in Bengaluru and Anirban Sen in New York; Editing by Shonak Dasgupta)
