Shares in UK tech darling Darktrace surge 17% after agreeing $5.32bn private equity sale to Thoma Bravo

In this photo illustration, the DarkTrace logo is displayed on a smartphone with stock market percentages in the background

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LONDON – British cyber security company Hidden Trace announced on Friday that it has agreed to be acquired by US private equity giant Thomas Bravo for US$5.315 million in all cash.

Darktrace shares rose 17% at 10:26 a.m. London time.

Under the terms recommended by the board, investors will receive $7.75 in cash for each share.

The privatization of the company will be seen as a major push for a listing on the London Stock Exchange in 2021. The company is seen as a welcome and dynamic addition to a market that is generally considered less attractive to technology companies than the US or Asia. and filled with “old economy” players such as miners and oil and gas companies.

Darktress specifically cited its belief that it was undervalued in the UK as a reason for the sale. The company said in a statement that its board believed the company’s operational and financial “achievements” were not reflected in the valuation and that its shares were trading at a “significant discount to global peers”.

Darktrace was founded in 2013 and is headquartered in Cambridge, England. The company specializes in providing AI-based cloud attack protection for large companies and events and has approximately 2,300 employees worldwide.

Thoma Bravo said the acquisition will increase its exposure to the large and growing cybersecurity market, and the investment in Darktrace will help expand the scale of its global business.

The transaction represents a 44.3% premium to DarkTrace’s average volume-weighted share price in the three months ended April 25, according to the release.

DarkTrace said on Friday that it rejected an earlier unsolicited takeover bid from Thoma Bravo after the tech company assessed that it did not adequately value the business.

The company has faced many challenges since its listing, including a short-selling attack in 2023, which led it to defend its accounting practices. It has also tried to distance itself from co-founder investor Mike Lynch, who faces fraud charges in the US.

Shadow stock prices.