Permira plans to take e-mail security firm Mimecast private in a $5.8B all-cash deal

Nine months after competitor Proofpoint was scooped up by Thoma Bravo for $12.3 billion, Mimecast is also going the private equity route. Today the security company announced that Permira would be taking Mimecast private in a $5.8 billion all-cash deal. Mimecast has been public since 2015, and this deal is being made at a price of $80 per share, the parties said.

The news follows a report published earlier today that Thoma Bravo was raising $35 billion to focus on buy-outs of tech companies, and comes in a year that has been a very active one for PE firms in the sector.

In the wake of the Covid-19 pandemic and people working more remotely and shifting everything online, it has also been a very, very big year for cybersecurity, and so that puts a particular focus on London-founded Mimecast’s specialty area of e-mail security. The company, listed on Nasdaq, has more than 39,000 business customers, with some 20,000 of those using its products to secure Microsoft 365 deployments in particular. It has been trading up over this year and last closed at $75/share and with a market cap of just under $5 billion; this deal represents a premium on that.

“We have long admired Mimecast, its management team and its talented employees,” said Permira Partners’ Michail Zekkos and Ryan Lanpher in a joint statement. “Email is the leading vector for cyberattacks, and phishing and impersonation attempts are continuously evolving. This means there has never been more urgency or need for organizations to protect their critical data and infrastructure. With an innovative platform, world-class security controls and scalable model, Mimecast is ideally positioned to help companies both large and small protect their employees from malicious activity. We look forward to leveraging our experience scaling global technology businesses as we partner with Peter and team on their next phase of growth.”

“Today is an exciting milestone for Mimecast as we begin a new chapter for our company,” added Peter Bauer, chairman and chief executive officer of Mimecast, in a statement. “Our team has done an outstanding job growing and expanding our relationships with customers and innovating our platform. Permira has a strong track record of collaboratively supporting companies’ growth ambitions and strategic goals, and we look forward to working together to further strengthen the cybersecurity and resilience of organizations around the world. This is a great outcome for our company and our shareholders.”

The company had been in the midst of a strategic review prior to the deal and rumors were floated at the end of October that it was looking at raising money or selling itself.

“This transaction follows a strategic process overseen and directed by an independent Special Committee of the Board of Directors that included discussion with a number of strategic and financial parties. We are pleased to deliver significant immediate cash value to our shareholders and believe that this transaction is the best path forward for Mimecast and our stakeholders,” said Robert Schechter, independent director of Mimecast and chair of the Special Committee, in a statement.

The transaction is expected to close in the first half of 2022, subject to customary closing conditions, which include approval by Mimecast shareholders and regulatory approvals.

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