Precisely Gains New Majority Owners in $3.5 Billion Deal
From the Wall Street Journal…
Two private-equity firms have agreed to back data-integrity business Precisely in a $3.5 billion deal, people familiar with the situation said, banking on the growth and importance of trusted data.
Once closed, the deal will result in private-equity firms TA Associates and Clearlake Capital Group—which was already a minority investor in Precisely—taking control of the business from Centerbridge Partners. Centerbridge, which acquired a majority stake in Precisely from Clearlake in 2017, will remain a minority investor.
Precisely, whose legal name is Syncsort Inc., has about 12,000 customers including major banks, large telecommunications companies, healthcare and retail businesses, and the government, according to Chief Executive Josh Rogers.
The Pearl River, N.Y., business traces its origins to 1968, when it launched as Syncsort. Entering the data-integration market later on, the company helped clients extract data from older computer systems and make it available for analytics applications, a transition it described as “Big Iron to Big Data.”
Since that time, Precisely has focused on data integrity—collecting and honing in on the accuracy of particular bits of data, such as demographics, location boundaries and the dynamic weather in a given area. It offers products specializing in integrating data, assuring the data’s quality, enriching data files and providing location intelligence.
Centerbridge acquired its majority stake in Precisely when it bought Syncsort and Vision Solutions Inc. from Clearlake and merged them in a $1.26 billion deal, according to a news release at the time. Clearlake had owned both companies and retained a minority interest in the combined business after that transaction closed.
Since Santa Monica, Calif.-based Clearlake’s original investment in 2015, Precisely has grown rapidly. Mr. Rogers said that at the time of the firm’s initial investment, Precisely’s annual revenue was $75 million. The company’s revenue reached about $600 million last year and it is expected to notch $650 million to $700 million this year, he said.
The company has expanded through numerous acquisitions over the years, a pace the new majority owners plan to maintain. In late 2019, Precisely closed its $700 million acquisition of Pitney Bowes Inc.’s software and data business.
The Pitney Bowes deal helped enhance Precisely’s market share for data-quality applications and added location intelligence and data enrichment capabilities, according to Mr. Rogers. He also highlighted macro trends, such as the continued generation of new data and the need to verify, integrate and enrich that information, as providing potential avenues for expansion.
Mr. Rogers cited a report by industry researcher International Data Corp. that shows spending on digital transformation by organizations isn’t expected to be affected by the Covid-19 pandemic. Last year, IDC estimated that global spending on these technologies would grow to $1.3 trillion in 2020. It projected in 2019 that such spending would reach $2.3 trillion in 2023.
From Precisely CEO Josh Rogers…
Global spending on digital transformation is expected to reach $2.3 trillion by 2023 (Source IDC). As data powers a worldwide wave of innovation, the need for trusted data on which to build this future increases exponentially. Precisely is unique in our ability to provide enterprise customers with accurate, consistent, and contextual data. The Precisely Data Integrity Suite, with its modular and interoperable structure, enables organizations to advance their data integrity initiatives without a monolithic, one-size-fits-all platform push.
I am incredibly excited for this next phase of our company. Clearlake and TA have a proven track record of partnering with software companies like Precisely that solve complex, critical business challenges and driving accelerated growth through operational best practices and M&A strategies to help them maximize their potential. I am excited to work with our long-time partners at Clearlake and thrilled to welcome TA and their expertise to the team. I’m confident that together we will deliver tremendous value to Precisely’s customers. I also want to thank Centerbridge Partners for their guidance and support over these past four years, and I am delighted they will continue as a minority investor in Precisely.
SpatialPoint considers this very good news. It expresses the confidence in the vision of data quality being a key aspect to the success of many business processes.
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