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Summary
- SAP SE is going to take its US-based subsidiary Qualtrics International Inc. for public listing.
- The public listing of Qualtrics is expected to take the valuation of the business up by nearly 50 per cent from what it had paid to acquire Qualtrics
- Qualtrics has fixed the initial price brand of stock between $20 and $24.
In a move to boost its business, German software company SAP SE said it is going to take its US-based subsidiary Qualtrics International Inc. for listing in stock markets.
SAP SE said the public listing of Qualtrics is expected to put the valuation of the business up by nearly 50 per cent from what it had paid to acquire it two years ago.
Qualtrics said in a regulatory filing that it had fixed the initial price brand of stock between $20 and $24. The company’s shares will trade on the Nasdaq under the ticker sign ‘XM’. The stock pricing can change based on the investors’ feedback till the day before the stock begins trading.
The IPO has come at a time when the German software giant is facing certain roadblocks in its business owing to the coronavirus crisis.
The controlling stake in Qualtrics will be retained by SAP following the planned IPO. The German company would also retain Qualtrics’s Class B shares that would give the software firm additional voting rights.
Silver Lake is going to buy $550 million of its stock, which includes 15 million shares at $21.64 per share in Qualtrics and the remaining at the IPO price.
In April, SAP abolished the structure of dual-chief-executive, which the firm had established just six months ago. Earlier in July, SAP CEO Christian Klein said the software firm would take its unit Qualtrics public, but the German company would remain the majority shareholder. The deal would enable Qualtrics to explore non- SAP business prospects.
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In November 2018, SAP had announced the plan to purchase the client-relationship management software supplier just before Qualtrics was set to go to the public markets. In fact, SAP paid about $8 billion, which is considered as one of its largest acquisitions ever. The deal was intended to compete with the rival firm Salesforce.com Inc.
In 2019, SAP’s acquisition of Qualtrics was completed, and the deal helped the firm to improve its effectiveness in the cloud-computing marketplace.
