HGGC Leads $1.125 Billion Recapitalization of IDERA
New Investment in Leading Database Management Technology and Application Development Company to Fuel Continued Growth
PALO ALTO, CA — HGGC, a leading middle market private equity firm, today announced the signing of a definitive agreement to recapitalize IDERA (or “the Company”), a leading provider of database lifecycle management solutions and application development tools. The $1.125 billion recapitalization, led by HGGC, is being done in partnership with TA Associates, which has owned IDERA since 2014, and IDERA management. Upon completion of the deal, HGGC will be the controlling investor in IDERA, with TA Associates and management retaining a significant ownership stake. The recapitalization includes funding for a pending add-on acquisition by IDERA that is signed and expected to close in the coming months.
Based in Houston, IDERA develops software that enables database professionals to design, monitor and manage data systems, and builds application development tools to help software engineers build, test, and deploy a wide range of applications faster and more efficiently. The Company’s customers span multiple industries, including Education, Energy, Financial, Government, Healthcare, Manufacturing, Media, Retail and Technology. The University of Notre Dame, Chevron, Saint Francis Health Services, and Microsoft are among the more than 20,000 organizations who use IDERA products every day.
“We are excited about becoming an investor in IDERA, which has not only achieved strong organic growth for over a decade, but has also successfully executed an aggressive acquisition strategy,” said Steve Young, HGGC Co-Founder and Managing Director. “We’re confident that our resources and relationships will help IDERA CEO Randy Jacops and his team build on their impressive success and continue to grow market share. We couldn’t ask for a better investor partner than TA Associates in this effort.”
IDERA is distinguished by its high-velocity, low-friction sales process, and innovative operating and delivery model. This approach adds more than 5,000 new customers annually and has helped drive a quadrupling of revenue since 2013. In addition, over the past 10 years, the IDERA management team has acquired and seamlessly integrated more than 20 businesses while achieving excellent margins.
“We are very pleased to strike this new partnership with HGGC,” said Hythem El-Nazer, Managing Director of TA Associates. “Since investing in IDERA in September of 2014, TA Associates has been privileged to partner with Randy Jacops and his team, and we are proud of the growth and accomplishments of the business over this period. We look forward to continuing our partnership with management and working alongside HGGC as IDERA continues to execute on its organic growth and add-on acquisition strategies.”
The database management systems and developer tools markets combined represent a more than $50 billion market opportunity where solutions provided by large enterprise software companies are aging, expensive and inflexible.
“IDERA’s efficient and highly-flexible research and development model, as well as its culture of continuous change, enables the Company to pivot in response to customer demand and quickly bring new software products to market,” added Neil White, Managing Director of HGGC.
“HGGC’s ‘Advantaged Investing’ model creates strong alignment of interests among principals and made the firm a very attractive partner for us,” said Jacops. “We’ve enjoyed a tremendous partnership with TA Associates and are confident we will have a similarly collaborative relationship with the HGGC team. HGGC has an outstanding reputation and track record, and they are already bringing a new excitement about what we can achieve together.”
William Blair is serving as financial advisor to IDERA. Kirkland & Ellis LLP is serving as legal counsel to HGGC. Jefferies LLC is serving as financial advisor to HGGC and, through its affiliates, has agreed to provide debt financing in connection with the transaction.
HGGC is a leading middle-market private equity firm with over $4.3 billion in cumulative capital commitments. Based in Palo Alto, Calif., HGGC is distinguished by its “Advantaged Investing” model that enables the firm to source and acquire scalable businesses at attractive multiples through partnerships with management teams, founders and sponsors who reinvest alongside HGGC, creating a strong alignment of interests. Over its history, HGGC has completed more than 60 platform investments, add-on acquisitions, recapitalizations and liquidity events with an aggregate transaction value of more than $13 billion. More information is available at www.hggc.com
About TA Associates
TA Associates is one of the largest and most experienced global growth private equity firms. The firm has invested in more than 480 companies around the world and has raised $24 billion in capital. With offices in Boston, Menlo Park, London, Mumbai and Hong Kong, TA Associates leads buyouts and minority recapitalizations of profitable growth companies in the business services, consumer, financial services, healthcare and technology industries. More information about TA Associates can be found at www.ta.com.
IDERA designs powerful software with one goal in mind – to solve customers’ most complex challenges with easy-to-use solutions. IDERA’s unique DNA is reinforced by user communities of more than 3 million database and developer professionals who use and evangelize IDERA tools. From award-winning SQL Server database solutions to market-disrupting test management tools, IDERA ensures your business never slows down. Contact us at +1-713-523-4433 or visit www.idera.com for free trials, free tools and more.