Kape receives $1.5bn proposal to go private
The public parent company of ExpressVPN, Private Internet Access and CyberGhost may soon be a private entity – owned outright by its current majority shareholder, Unikmind.
The entity, owned by billionaire businessman Teddy Sagi, has proposed to purchase all the shares of Kape Technologies which it doesn’t have in hand and take the company private. This offer, pricing Kape at a premium of just over $1.5 billion, comes a year after the acquisition of industry heavyweight ExpressVPN (opens in new tab) for $936 million.
The offer documentation (opens in new tab) is hefty and says the offer reflects a desire to “sustain [the company’s] expansion” and enable “long term capital investment conducted away from public markets”.
“We are committed to Kape’s further growth within our group of companies, enabling it to exploit operational synergies and to access capital for its continuous growth, especially as the convergence of technologies is gaining momentum”, said Sagi.
What it means for users?
What does this mean for the seven million subscribers using Kape’s various VPN and security products?
Unikmind says that it “does not intend there to be any material changes to Kape’s business (save for potential acceleration of inorganic growth), broader strategic plans, or locations and places of business.”
The proof will be in the pudding. In particular, we’ll be looking for Kape’s VPN brands to continue their track record of publishing independent audits (opens in new tab).
Unikmind’s offer makes several references to “expansion” and a “buy-and-build strategy”, including noting that in the current market, “the availability of potential acquisitions may be increased”.
Between this offer and Kape’s recent placement news, where the company talks about securing additional financing to increase Kape’s ability to accelerate its growth through acquisitions, Unikmind is clearly signaling interest in growing its privacy and security holdings.
Echoes of McAfee
This potential deal comes 11 months after a parallel move in the consumer cybersecurity industry in which McAfee was taken private by a group of investors for $14 billion. McAfee had communicated the take-private deal as an opportunity for the investor group to “provide McAfee with both financial and operational resources to further enhance its consumer offering and capture the rapid growth in consumer demand for digital protection services.”
McAfee has since launched its McAfee+ service, which combines its antivirus offering with a VPN, a password manager, identity theft and credit monitoring.
While the Kape take-private deal is much smaller, it’s clear that the burgeoning opportunity in the privacy and security space is proving enticing to investors.
Audio player loading… The public parent company of ExpressVPN, Private Internet Access and CyberGhost may soon be a private entity – owned outright by its current majority shareholder, Unikmind. The entity, owned by billionaire businessman Teddy Sagi, has proposed to purchase all the shares of Kape Technologies which it doesn’t…
