I feel obligated to cover this one.
Reuters is reporting that N-Able, with a market value of $2.5 billion, is exploring a sale after attracting acquisition interest. The sale process involves software sector peers and private equity firms, with cybersecurity company Barracuda Networks, owned by KKR, among the suitors. N-Able was spun out from SolarWinds in 2021 and counts Silver Lake and Thoma Bravo as major investors. Take-private deal volumes have increased, with education software firms PowerSchool and Instructure also in talks for a sale. N-Able’s shares rose over 8% on the news.
Michael Novinson on Bank Info Security offered that this is a good match, with N-Able bringing MSP tools and Barracuda bringing tools better regarded by technology analysts. Quote: “Its network firewall is recognized as a visionary by Gartner, and its web application firewall and its enterprise email security products were recognized as strong performers by Forrester between summer 2022 and spring 2023. In contrast, N-able doesn’t appear in any Gartner Magic Quadrants or Forrester Waves.”
Channel Futures offered Canalys insights, in that N-Able could be an attractive acquisition target, potentially impacting the RMM market. However, selling now could be premature, as it has a broad portfolio and has initiated an interesting ‘Ecoverse’ strategy.
Why do we care?
Disclosure: I’m an N-Able shareholder.
Let’s start with the headline – investors make a change like this because something isn’t working. So the headline is “N-Able isn’t cutting it as a public company.” I’m afraid I can’t agree with Canalys here – it’s not premature. They’re the third-place player in the market with upstarts at their heels and little to stand out from the crowd.
For my money, another private equity reshuffle isn’t necessarily the answer. That said, my money is over on customer value creation, and I don’t expect KKR, Thoma Bravo, or Silver Lake to be in the same business I am.