On Monday, Squarespace, a website-building platform, announced a $6.9 billion all-cash transaction with Permira to exit the public market after three difficult years.
Permira agreed to pay $44 per share in cash, representing a nearly 30% premium over Squarespace’s unaffected share price. Squarespace has failed to acquire public market support in recent years, opening below its $50 reference price in 2021 and never trading beyond its $48 open price.
“We are thrilled to be partnering with Permira on this new leg of our journey,” Squarespace founder and CEO Anthony Casalena stated in a press release. Casalena, along with current investors Accel and General Atlantic, own 90% of Squarespace’s voting shares. All three have authorized the transaction and will remain investors after Permira closes.
Squarespace competes with Wix and Shopify for a share of the website-building and e-commerce business. In pre-market trade, shares jumped nearly 13% to $43 each. Permira is partnering with Ares Capital, Blackstone, and Blue Owl to finance the transaction.
“We are excited to work with Anthony and his team to help the company reach its full potential,” Permira partner David Erlong said in a release.
Squarespace’s decision to go private follows a trend among smaller technology companies in the previous two years, some of whom have been burnt by the public markets or believe they can add more value by merging with other PE portfolio companies. Qualtrics, for example, was spun off from SAP in 2021 and quickly purchased private again in 2023 by Canada’s pension plan and Silver Lake for $12.5 billion.
Toshiba likewise went private in 2023 for $13.6 billion, following years of speculation and turmoil, including a long-running relationship with activist investor Elliott.
Investors are keeping a tight eye on the dealmaking area following a quiet 2022 and 2023, which left several late-stage businesses in an IPO holding pattern. M&A activity appears to be starting up again, and some late-stage companies have already gone public or intend to do so.
Squarespace and its special committee were advised by Centerview, J.P. Morgan, Skadden, and Richards, as well as Layton and Finger. Goldman Sachs and Latham & Watkins advised Permira.
