Thoma Bravo Acquires FinTech Digital Payments, Fraud Detection Company Bottomline

Private equity firm Thoma Bravo has acquired FinTech digital payments management company Bottomline Technologies for $2.6 billion, and the private equity firm will take the FinTech digital payments software company private.

The buyout price tag represents a 41% premium to Bottomline’s 30-day volume weighted average price as of October 19, 2021, Thoma Bravo indicated.

This is technology M&A deal number 786 that ChannelE2E has covered so far in 2021. See all technology M&A deals for 2021 and 2020 listed here.

Thoma Bravo Acquires Bottomline: About the Seller and Buyer

Corporations and banks leverage Bottomline’s software for domestic and international payments, cash management, automated workflows for payment processing and bill review, and fraud detection, behavioral analytics and regulatory compliance solutions, the seller said.

Bottomline’s partner ecosystem spans channel partners and solution partners that focus on (1) digital banking, (2) fraud and financial crime management, and/or (3) legal spend management.

Bottomline’s revenue was $123.6 million for the quarter ended September 30, 2021, up 10% as compared to the first quarter of last year. GAAP net loss for the first quarter was $4.9 million, BottomLine disclosed in November 2021.

Thoma Bravo is a top-tier private equity firm that focuses on multiple technology sectors. Within the IT channel, Thoma Bravo is perhaps best known for owning and/or backing Barracuda, ConnectWise, N-able and Sophos, among other MSP-friendly technology businesses.

Thoma Bravo Buys Bottomline: Executive Perspectives

In a prepared statement about the deal, Bottomline CEO Rob Eberle said:

“This transaction is an exciting next chapter for our company, our customers and our employees, and is a testament to the hard work and dedication of the entire Bottomline team. We have been executing against our strategy of establishing competitive advantage with a product set designed to transform business payments for companies and financial institutions around the world. Our partnership with Thoma Bravo will provide additional resources and greater flexibility to build on our leadership position, invest in continued innovation and accelerate go-to-market efforts to deliver increased value to customers. Additionally, the transaction will allow Bottomline to benefit from the operating capabilities, capital resources and sector expertise of one of the most experienced and successful software and financial technology investors.”

Added Joe Mullen, chairman of the Bottomline board:

“We are confident that Thoma Bravo is the ideal partner for Bottomline given its strong track record of investment in the technology industry and its deep appreciation for Bottomline’s people, products and future growth opportunities. The Bottomline Board of Directors regularly evaluates opportunities to enhance shareholder value. Following a thorough process to review strategic alternatives, we are confident that this transaction with Thoma Bravo provides a compelling opportunity to deliver immediate and certain cash value at a meaningful premium to Bottomline shareholders, as well as significant long-term benefits for customers, channel partners and employees.”

Noted Holden Spaht, a managing partner at Thoma Bravo:

“As the digital transformation of business accelerates, we see tremendous opportunity for Bottomline to continue capitalizing on its unique position, particularly in the large and growing B2B payments market, and successfully deliver its diverse portfolio of products that intelligently digitize the way businesses pay and get paid. Bottomline is well positioned in exciting and dynamic markets and we look forward to applying our operational and investment expertise in software and financial technology to support Bottomline in its next phase of growth.”

Concluded Brian Jaffee, a principal at Thoma Bravo:

“We’ve been tracking Bottomline as part of our broader financial technology effort for many years and are excited to work closely with the company to continue building on its strong track record of consistent innovation and growth. We look forward to partnering with Bottomline’s highly-experienced management team to support their vision for continued growth and unwavering focus on delighting customers.”

Thoma Bravo Funds and Acquisitions

Thoma Bravo appears well-funded to make additional acquisitions throughout 2022 and beyond. Indeed, Thoma Bravo in October 2020 raised $22.8 billion to address:

  • $17.8 billion for the Thoma Bravo Flagship Fund XIV;
  • $3.9 billion for the Thoma Bravo Discover Fund III to back midsize enterprise software and technology businesses; and
  • $1.1 billion for Thoma Bravo Explore Fund, which targets small technology businesses.

The figures above are based on a 2020 Wall Street Journal report.

Fast forward to September 2021, and Thoma Bravo apparently opened a new “deal room” to enable prospective investors to review documents about new funds.

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