MILWAUKEE -- RedPrairie Holding Inc., a productivity solutions provider, has entered into a definitive agreement to be acquired by a fund affiliated with New Mountain Capital LLC, a leading private-equity firm. This acquisition will enable RedPrairie to accelerate its growth rate while enhancing its commitment to customer success, it said.
Details of the transaction were not disclosed. The business software firm had submitted a filing for an initial public offering (IPO) of up to $173 million last November. Its previous owner, Francisco Partners, holds a 90% stake and was [image-nocss] expected to sell on the offering; according to a blog entry by Renaissance Capital.
Francisco Partners bought RedPrairie for $240 million in April of 2005, 20 years after RedPrairie was founded. (The remaining 10% belongs to Erez Goren, former CEO of BlueCube Software, which was acquired by RedPrairie in 2006.)
At a time when the IPO market has become increasingly selective and price sensitive, New Mountain Capital's acquisition offers an alternative and more certain exit strategy for Francisco Partners, said the blog.
RedPrairie's sale may have resulted from a dual-track process, in which a company aims to solicit bids concurrent with its pursuit of an IPO, it added. Continued private ownership provides immediate access to liquidity for its current owner, along with the opportunity to avoid some of the costs and risks associated with a public offering, Renaissance Capital said.
"Our objective is to be the leading provider of productivity solutions for manufacturers, distributors and retailers," Mike Mayoras, CEO of Milwaukee-based RedPrairie, said in a press statement. "Our relationship with New Mountain Capital will allow us to reach our strategic goals quickly, efficiently and with certainty. We believe there are significant opportunities to provide more value to our customer base by expanding our product portfolio and entering new markets."
Alok Singh, managing director of New Mountain Capital, said, "We are delighted at the prospect of being able to add RedPrairie to our family of companies. They have consistently, over their long history, been committed to the success of their customers. We aim to work closely with RedPrairie's management team and help them accelerate their growth and strategic development, making them an even more valued partner to their customer base."
Said David R. Golob, chairman of the RedPrairie board of directors and partner at Francisco Partners, "RedPrairie has a strong vision, proven set of solutions and talented management team. I believe RedPrairie and New Mountain Capital will be a great combination. I wish them continued success."
New Mountain Capital is a New York City-based private-equity firm investing for long-term capital appreciation through direct investment in growth equity transactions, leveraged acquisitions, and management buyouts. The firm currently manages private and public equity funds with approximately $8.5 billion in aggregate capital commitments. New Mountain seeks out growth leaders in carefully selected industry sectors and then works intensively with management to build the value of these companies.
Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.