Thoma Bravo, a leading technology-focused private equity firm, is exploring a potential sale of Cority, a sustainability compliance software maker, with hopes of securing a valuation around $2 billion, according to sources familiar with the matter. The buyout firm has engaged Goldman Sachs to manage the sale process, which is expected to attract interest from other private equity firms and investors.
Valuation and Financials
Thoma Bravo aims to achieve a valuation for Cority that is more than 20 times the company’s EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) of approximately $90 million over the past 12 months. EBITDA is a measure of a company’s overall financial performance and is used as an alternative to simple earnings or net income.
Market Interest in Compliance Software
In recent years, compliance software makers like Cority have garnered significant interest from private equity firms. This trend is driven by large corporations increasing their technology spending on risk management and supply chain protection. For example, EQT acquired Avetta for about $3 billion in April, highlighting the rising demand for such technologies.
About Cority
Based in Toronto, Canada, Cority provides software solutions for tracking company progress towards Environmental, Social, and Governance (ESG) goals. The software also helps in monitoring employee health, managing risk factors, and ensuring regulatory compliance. Cority boasts a robust customer base of over 1,500 clients across 120 countries, serving industries such as healthcare, aerospace & defense, manufacturing, and energy & utilities. Notable clients include Merck, Volvo, Dow Chemical, Siemens, and Rio Tinto.
Thoma Bravo’s Recent Activities
Thoma Bravo, headquartered in Chicago, manages roughly $142 billion in assets and is renowned for its extensive activity in the software industry. Earlier this year, Thoma Bravo took software maker Everbridge private in a deal worth about $1.8 billion. Additionally, in July, the firm sold education software company Instructure to KKR for $4.8 billion.
Thoma Bravo’s strategic decisions and acquisitions underscore its influential presence in the software and technology sectors. The potential sale of Cority aligns with its ongoing strategy to leverage high-value deals in the rapidly evolving tech landscape.
