SolarWinds to go private after $4.4bn acquisition by Turn/River Capital

In a significant move within the technology sector, SolarWinds Corporation, a leading provider of IT management software, has announced a definitive agreement to be acquired by Turn/River Capital in an all-cash transaction valued at approximately $4.4 billion. The deal will see SolarWinds’ shareholders receive $18.50 per share, representing a 35% premium over the company’s volume-weighted average closing price for the 90 trading days ending February 6, 2025.

The acquisition marks a pivotal transition for SolarWinds as it prepares to shift from a publicly traded company on the New York Stock Exchange to a privately held entity. This strategic move is expected to enhance SolarWinds’ operational flexibility, enabling the company to focus on long-term growth initiatives without the pressures typically associated with public market performance.

Why is Turn/River Capital acquiring SolarWinds?

The SolarWinds acquisition deal reflects Turn/River Capital’s strategic interest in expanding its portfolio within the software sector, particularly in companies offering mission-critical IT solutions. Turn/River Capital, known for investing in high-growth technology companies, sees SolarWinds as an ideal partner due to its global presence, innovative product suite, and strong customer base in the observability and IT management sectors.

According to Dominic Ang, Founder and Managing Partner of Turn/River Capital, SolarWinds’ consistent growth, commitment to customer-centric solutions, and track record of innovation made the company an attractive acquisition target. “SolarWinds is a global leader in software that helps businesses securely manage and optimise their systems, networks, and IT infrastructure,” Ang stated. “We are incredibly excited to partner with SolarWinds. By combining our operational expertise with SolarWinds’ relentless focus on customer success, we aim to accelerate growth and foster even greater technological advancements.”

This Turn/River Capital partnership aligns with the private equity firm’s broader strategy of supporting software companies poised for expansion. With Turn/River’s backing, SolarWinds is expected to deepen its investments in product development, enhance customer experiences, and scale its operations to meet the growing demands of businesses navigating hybrid and multi-cloud environments.

How will the acquisition impact SolarWinds’ operations?

While the SolarWinds acquisition deal represents a major financial transaction, the company’s core operations will remain largely unchanged. SolarWinds will continue to operate under its current name, maintain its headquarters in Austin, Texas, and retain its leadership team, including President and CEO Sudhakar Ramakrishna.

Ramakrishna expressed optimism about the future, highlighting that the partnership with Turn/River Capital would enable SolarWinds to accelerate its growth trajectory. “We have built a strong track record of helping customers transform their businesses through simple, powerful, secure solutions designed for hybrid and multi-cloud environments,” he said. “This successful transaction is a testament to our employees’ outstanding work and our commitment to customer success.”

The acquisition is expected to provide SolarWinds with greater financial flexibility to invest in research and development, expand its global footprint, and adapt quickly to technological advancements in the IT landscape. By transitioning to a private company, SolarWinds can focus on long-term strategies without the short-term performance pressures that often accompany public market expectations.

What are the financial details of the SolarWinds acquisition deal?

Under the terms of the agreement, SolarWinds’ shareholders will receive $18.50 per share in cash, reflecting a significant premium over the company’s recent trading prices. The total enterprise value of the transaction is estimated at $4.4 billion, highlighting the substantial market confidence in SolarWinds’ future prospects.

The deal has received unanimous approval from SolarWinds’ Board of Directors and has been endorsed by the company’s majority shareholders, including Thoma Bravo and Silver Lake, who collectively hold approximately 65% of the outstanding voting securities. Notably, the transaction does not require further shareholder approval, as Thoma Bravo and Silver Lake have already provided written consent.

The acquisition is expected to close in the second quarter of 2025, pending regulatory approvals and other customary closing conditions. Once finalised, SolarWinds’ common stock will be delisted from the New York Stock Exchange, marking its transition to a privately held company.

What does this mean for SolarWinds’ customers and stakeholders?

For SolarWinds’ extensive customer base, which spans a wide range of industries and geographies, the acquisition is expected to be largely seamless. The company has assured its clients that there will be no disruption to existing services, product offerings, or support channels.

In fact, the Turn/River Capital partnership is anticipated to bring added value to customers by enabling SolarWinds to accelerate product innovation and improve service delivery. The company plans to leverage Turn/River’s expertise to enhance its IT management software solutions, focusing on areas such as observability, monitoring, and service desk capabilities.

Ramakrishna underscored the company’s commitment to maintaining strong customer relationships and delivering cutting-edge technology. “With Turn/River’s support, we will continue to invest in our platform to meet the evolving needs of our customers,” he said.

Expert perspectives on the acquisition

Industry analysts view the SolarWinds acquisition deal as a strategic move that could reshape the competitive landscape of the IT management sector. The acquisition allows SolarWinds to operate with increased agility, pursue innovative projects, and respond swiftly to market demands—all of which are critical in the fast-evolving world of IT.

“Going private often enables companies to focus on long-term growth without the quarterly pressures of public markets,” noted a senior technology analyst from a leading consultancy firm. “For SolarWinds, this could mean accelerated development in areas like cloud observability, cybersecurity, and AI-driven IT solutions.”

Advisors involved in the transaction

Several prominent financial and legal advisors played key roles in facilitating the SolarWinds acquisition deal. Goldman Sachs & Co. LLC served as the lead financial advisor to SolarWinds, with Jefferies LLC also providing financial guidance. Legal counsel was provided by DLA Piper LLP (US).

On the buyer’s side, Turn/River Capital was advised by J.P. Morgan, Barclays, Santander, and RBC Capital Markets. Kirkland & Ellis LLP acted as legal counsel for Turn/River Capital, ensuring a smooth negotiation and transaction process.

What’s next for SolarWinds?

As the company embarks on this new chapter, the focus will remain on innovation, growth, and customer satisfaction. The Turn/River Capital partnership is expected to unlock new opportunities for SolarWinds, positioning it to thrive in an increasingly complex IT environment.

While the company’s future as a private entity unfolds, industry observers will be watching closely to see how SolarWinds leverages its newfound flexibility to push the boundaries of IT management software and maintain its leadership position in the tech industry.