Zendesk is close to an impressive takeover deal, sources say

Zendesk is close to an impressive takeover deal, sources say

Zendesk Inc.

is close to a deal with a group of takeover companies, according to people familiar with the matter, reviving a failed bid to sell it in one of the biggest private equity takeovers of the year.

A deal with a group that includes Hellman & Friedman LLC and Permira could be struck in the coming days, provided the talks do not collapse, people said. The price could not be ascertained.

Zendesk, which has a market capitalization of about $ 7 billion, was expected to enter into a settlement agreement with activist investor Jana Partners LLC a few days after the company closed its bid in a private equity auction, the Wall Street Journal reported last week. .

Zendesk and Jana were discussing a truce that could include Mikkel Svane’s resignation as chief executive of the software company, as well as changes to the board, including the removal of CEO Carl Bass.

It is unclear where Zendesk’s discussions with Jana are in the light of the expected takeover agreement.

Zendesk said earlier this month that it would remain independent after talks with potential buyers, as financial market volatility makes it more difficult to finance deals.

The company said in February that it had rejected a takeover bid of about $ 17 billion from a group of unnamed private companies.

The newspaper reported at the time that the group included Hellman & Friedman, Advent International Corp. and Permira.

Zendesk shareholders then voted against the planned acquisition of SurveyMonkey, the parent company Momentive Global Inc., forcing the company to abandon a $ 4.1 billion deal.

Zendesk specializes in helping companies communicate with customers and said on its website that it had more than 160,000 paid accounts and about 5,450 employees. It was founded in 2007 and is based in San Francisco.

Private equity firms are arming themselves with mountains of cash to operate, but have struggled to complete deals in recent weeks as debt has become increasingly expensive. Before the slowdown, software was a particularly hot spot thanks to its steady cash flow.

In March, Thoma Bravo LP closed a $ 10.7 billion deal to acquire Anaplan Inc. which was later revoked. Vista Equity Partners and Elliott Management Corp. private equity arm. worked together on a $ 13.6 billion deal for Citrix Systems Inc.

in January.

Permira and Advent teamed up in November to buy security software maker McAfee Corp. for about $ 12 billion.

With offices in San Francisco, New York and London, Hellman & Friedman manages about $ 90 billion.

Permira manages more than 60 billion euros, equivalent to about $ 63 billion, according to its website.

Write to Laura Cooper at laura.cooper@wsj.com and Cara Lombardo at cara.lombardo@wsj.com

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