Stamps to be acquired by Thoma Bravo: What happens to STMP stock?

3 min read | July 10, 2021 12:43 AM AEST | By Raza Naqvi

Stamps to be acquired by Thoma Bravo: What happens to STMP stock? — Image source: ESB Professional, Shutterstock

What happens to STMP stocks?

Investors seems to be responding positively to the announcement made on Friday morning.

As per the deal, Stamps’ shareholders are set to receive US$ 330 per share, about 67 per cent more than Stamps’ closing price at the end of the trading session on Thursday.

It is expected that the existing shareholders will likely hold on to the stock, while new investors try to fetch it at prices lower than the US$ 330 mark.

Once the acquisition deal is closed, Stamps is expected to become a private company. However, it will continue its old business operations and provide mailing and shipping solutions to the customers.

According to the company’s statement, Stamps is looking to benefit from the capital support and sector expertise of Thoma Bravo in future.

As per the official statement by the companies, this deal is likely to close by the end of this year's third quarter. It will be subjected to some conditions, including the approval of STMP stockholders and a receipt of regulatory approvals.

Why is this deal important for both companies?

Ken McBride, Chairperson and CEO of Stamps, said that the acquisition deal is a significant milestone, adding that it will provide them with a new platform to develop global strategies using top software and technologies.

Revealing the reason behind the acquisition move, Holden Spaht, Managing Partner at Thoma Bravo, said that Stamps has established itself as a significant source of e-commerce solutions worldwide. In addition, Thoma Bravo is looking to make gains from the company's management team and capitalize on the rising demand for e-commerce products and services.

As a private equity firm, Thoma Bravo is said to focus on software-based companies. According to reports, it has US$ 78 billion in assets under management, and with this deal, it is looking to unleash its growth potential further.

Notably, the firm's company portfolio includes cybersecurity firm McAfee and information technology services provider SolarWinds.

Under this deal, Stamps has been granted a 40-day period in which it can consider alternative offers from potential bidders, so there are chances that the shareholders could make more benefits.

The above constitutes a preliminary view and any interest in stocks should be evaluated further from investment point of view.

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